Monday, March 11, 2019

Best Practices in End-to-End Supply Chain

The latest ASQ CEO blog post asks "what are some best practices for planning and implementing  [E2E] Supply Chain to ensure success?"

Investopedia defines an E2E SCP as, "...a term used to describe products or solutions that cover every stage in a particular process, often without any need for anything to be supplied by a third party. It also embraces a philosophy that eliminates as many middle layers or steps as possible to optimize performance and efficiency in any process."

E2E Supply Chain graphic via LeanCorp.com

Traditional supply chains involve individual organizational silos that often result in inefficient overall performance and constrained supplier relationships. An end-to-end view of the complete supply chain begins with product design, supplier selection and management, then scheduling, production, distribution, and should include after-sale customer service. A holistic E2E Supply Chain integrates all revenue and expense streams. Effective E2E Supply Chains enable disruptive innovations in customer experience by delivering greater visibility of product design & performance and manufacturing capabilities, as well as order management and inventory status.

Building an effective E2E Supply Chain requires the implementation of an Enterprise Resource Planning (ERP) system that bundles top-level business processes such as Concept-to-Launch, Procure-to-Pay and Order-to-Cash functions as well as Hire-to-Retire and Sustain-and-Retain human capital asset management processes to present a holistic view of supply chain operations, while improving organizational strategic planning & deployment, decision-making, workforce planning and overall business growth.

Best Practices in E2E Supply Chains:
  • Inventory Management via Lean principles to eliminate waste (including unnecessary inventory) and reduce non value-added activities thereby reducing lead times and order fulfillment errors, resulting in improved customer perceptions of organizational responsiveness. 
  • Customer Demand Planning that uses the customers' order history, market analysis, seasonality, competitive landscape, and other factors to understand your customer needs better than they do enabling a more stable and predictable planning process.
  • Human Capital asset planning and management that assesses current workforce capability and capacity in response to strategic plans, focusing on the organization's core competencies and strategic advantages.  
  • A Lean Management System deploying data-driven root cause analysis where everyone from the CEO down to the intern is a problem solver, coupled with stronger supplier & vendor collaboration can strengthen an organization’s ability to plan effectively and respond to changes with greater agility.
Superior network connectivity between the supplier - manufacturer - customer can be a distinct competitive advantage to building strong business relationships. Working within and across the network to improve quality, service and cost at all touch points is a winning formula to help assure business success.

Monday, December 17, 2018

Developing a High-Performing Workforce

In the prologue of the December ASQ Roundtable topic to its Influential Voices, it is noted there is a growing trend in the workplace suggesting that end-of-year performance reviews are no longer effective. According to a Deloitte Insights survey, 58% of the companies polled reported that they view their current performance management process as not being an effective use of time and only 8% reported that their process drives high levels of value. To remedy this, some companies have decided to utilize software to improve their process. Other companies have elected to eliminate reviews altogether.



The topic for the December roundtable discussion is, "What is the most effective performance management approach to encourage high performance year-round?"

As a Baldrige Examiner, I like to begin my roundtable discussions with a review of the Baldrige Criteria. Category 5 of the Criteria focuses on the Workforce. The Workforce category asks how the organization assesses Workforce Capability and Capacity needs and builds a workforce environment conducive to Engagement and High Performance. The Baldrige Criteria defines High Performance as ever-higher levels of overall organizational and individual performance, including quality, productivity, innovation rate and cycle time. High performance results in improved service and value for customers and other stakeholders. High performance stems from and enhances workforce engagement. Some characteristics about workforce high performance:
  • It involves cooperation between management and the workforce; cooperation among work groups and teams; empowerment of employees and building personal accountability.
  • It may involve learning to build individual and organizational skills; creating flexible job design; decentralized decision making and making decisions closest to the front line.
 


My career experience, and observations of applicants to state and national quality programs using the Baldrige Criteria has revealed six key processes necessary to effectively encourage high performance:
  1. A Formal on-boarding as part of the New Employee Orientation process 
  2. Providing immediate, open and honest feedback
  3. Regular, periodic "pulse" surveys to measure employee satisfaction and engagement
  4. Frank, two-way skip-level meetings between management and its people
  5. A Career Pathing process to manage employee progression
  6. A Learning & Development System that supports organizational needs and employee development
  7. Systems & Structures supporting compensation, benefits and policies, rewards, recognition, as well as incentives to encourage continuous improvement, intelligent risk-taking, innovation and customer focus.
For more information about these key business and workforce processes, I highly recommend learning about the Baldrige Excellence Framework and attending Baldrige Evaluator training.

Sunday, September 23, 2018

Strategies to Reduce Change Resistance

The September 2018 ASQ Roundtable topic asks, "What are some recommended strategies or tactics to help achieve successful change management?" It’s often said that people don’t resist “change” so much as they resist “being changed.” So, the job of change management is clear: In a nutshell, you must explain why the affected people should want to change, and thereby cultivate readiness instead of resistance."

Another popular saying regarding change resistance is that the only people who like change are babies (infants). But change is constant, and the rate of change in today's world is ever increasing. A mathematical model representing change acceptance is Q x A = E, where Q is the qualitative (technical) solution, A is the acceptance of change, and E equals the effectiveness of the project.

The successful change project recognizes that the team, stakeholders, influencers and the people directly impacted by the proposed change must first understand the change and how it affects them; their reservations, concerns and resistance must be acknowledged and addressed, and they must all embrace the change.

In an article titled "The 7 Dynamics of Change", Kenneth Blanchard, author of The One Minute Manager, wrote that people:
  • feel awkward, ill-at-ease, self-conscious or fearful about change
  • focus on what they think they will have to give up
  • feel alone, even if others are going through the same change
  • are at different levels of readiness for change
  • can handle only so much change
  • are concerned they do not have enough resources to cope with the change
  • will naturally revert to old behaviors if given the opportunity.

The change adoption (aka rate of diffusion) curve illustrates the impact of change readiness.



Given the variability in change effectiveness, what strategies can be deployed to improve readiness and acceptance? GE developed its Change Acceleration Process (CAP) in 1992 as part of its overall strategy to improve its competitive advantage. GE's CAP is a set of tools designed to accelerate and increase change effectiveness:

  • create a shared need for the change
  • understand and deal with resistance
  • mobilize commitment by building an effective influence strategy
  • continuous communication plan
  • address both the technical and human change strategies

The high-level GE CAP Model is shown below.



In an article published by Fast Company magazine (2008), author Dan Feliciano states, "It’s not that people don’t like change… they don’t like ambiguity and punishment." Dan offers, "Organizations need to focus on creating and communicating strategies to the employees... by creating goals, objectives, measures, targets, and identifying and resourcing key initiatives for your organization and then cascading the measure and initiatives to every person throughout the organization."

Building an influence strategy not only involves the engagement of the organization's leaders and managers, but also identifying the presence of any "Keyhubs" within the ranks of its employees. A keyhub is an individual, not on the org chart, who's experience/ opinion/ insight is highly sought after and respected by peers and colleagues. "Understanding these informal networks enables leaders to align the organization with its strategic direction and move more quickly and effectively. Once you get the culture, you can execute on strategy [and change] with greater ease and efficiency", Vikas Narula (@NarulaTweets), Creator and Co-Founder of Keyhubs (@Keyhubs).

Finally, holding the gains of any change effort requires the implementing of Systems and Structures that reward desired behaviors resulting in successful results, while making it difficult and even painful (more effort) to revert to old behaviors. Desired behaviors must be modeled by the organization's leaders. Such behaviors will create the experiences necessary to instill the right beliefs leading to sustainable culture change. (Journey to the Emerald City by Roger Connors and Tom Smith).

Tuesday, May 08, 2018

Quality in the Experience Economy

In March 2018 ASQ posited that "over the past two decades consumers have been gravitating towards purchases that are of both high quality and provide an experience. Quality of a product or service alone is no longer a differentiator, quality of experience is. Consumers are buying what will not only satisfy a need, but will illicit an emotion or establish a connection."

ASQ asks, "How will this shift to an experience economy affect the quality industry? What quality practices can be applied or adapted to ensure success in this new economic structure?"

In the Experience economy your products and/or services can surpass competitors by creating a consistently superior experience for your customer, delivering increased perceived value. In today's experiential economy the reliability and quality of products and services alone are considered "expected" or  "basic" levels of quality achievement. Today's savvy consumers want satisfying experiences throughout the value chain, from when they first gain awareness of your product or service, to its purchase and even post-purchase transactions. Every step along this value chain is an opportunity (aka touchpoint) to delight the customer. In this experience based economy, a satisfying customer experience delivers a demonstrable competitive advantage. Higher levels of satisfaction lead to increased customer loyalty. The ultimate expression of such loyalty is customer advocacy of your products and services. Customer advocates provide trusted word of mouth advertising, resulting in increased sales, revenue, and growth. A great way to begin understanding the customer experience with your products and services is to construct a "Journey Map" for each customer type.

In their book, A leader’s guide to innovation in the experience economy, B. Joseph Pine II and James H. Gilmore state that "Mass customization is the route up the progression of economic value (see Exhibit 1), customizing a good turns it into a service, customizing a service turns it into an experience and customizing an experience turns it into a transformation. Companies should focus on reaching inside of the individual, living, breathing customer, making their offerings as personal and as individual as the customer – whether it’s a consumer or business desiring that offering."


What quality practices can be applied or adapted to ensure success in this new economic structure?

In order to achieve the goal of delivering consistently superior customer experience, the organization and its Quality professionals must focus on the customer. Everyone in the organization - from the CEO to management, staff, production, and support must understand who their customers are and what they value; understand the organization's strengths and weaknesses, who are your competitors and what are your customers' perceptions of the competitors' advantages. A customer-focused organization must also develop strategies, objectives and tactics to meet future customer requirements and organizational needs.

The Baldrige Criteria offers a well-structured framework to build organizational performance excellence, focusing on the key areas of:
  • Leadership
  • Strategic Planning
  • Customers
  • Measurement, Analysis and Knowledge Management
  • Workforce
  • Operations
  • Results

Understanding your organizational profile and situation are excellent places to begin the improvement journey. Customer-focused organizations typically require that EVERYONE become a Problem Solver, often implementing such improvement strategies as Lean, Six Sigma, Total Quality Management, etc. Strategic Planning should include an environmental scan and benchmarking to reveal the organization's strategic challenges and opportunities, and encourage intelligent risk to drive innovation. The organization's core competencies must be identified, strengthened and leveraged to achieve its strategies and objectives. Strategic planning, business execution and change management are areas ripe for the quality professional to build upon his/her ancillary skills.

A customer focused organization that consistently delivers superior customer satisfaction resulting in loyalty and advocacy can only be achieved with an empowered and engaged workforce. "Customers will never love a company until the employees love it first." (Simon Sinek). An engaged employee gives his/her utmost. Again, per Simon Sinek, "The responsibility of leadership is to serve their people so that their people may better serve the customer. If leaders fail to serve their people first, customer and company will suffer." Quality professionals can strengthen their indispensability to the organization by building on their competencies of process and systems thinking to enhance teamwork dynamics and manage organizational white spaces, resulting in improved organizational communication, alignment and performance.

Implementing a measurement system to monitor customers' perceptions of your products and services is another key area of focus for the Quality professional. In today's connected world, metrics around social media content and customer feedback are necessary to understand and improve customer relationships. Commercial services now exist to help an organization listen to its current customers, lost customers and potential customers.

Improving the quality of your organization's performance effectiveness will deliver delightful customer experiences.

Monday, September 04, 2017

Use Design Thinking to Innovate Your Quality Improvement Journey

In its monthly blog, A View from the Q, ASQ asks the Quality community how they might use Design Thinking concepts to improve their problem solving and process improvement roadmaps. Design Thinking is a strategy-making process that focuses on customer behaviors rather than opinion (aka tribal knowledge) and market research.

There is a lot of press lately about Design Thinking concepts, applications and examples in the development of new products and opening new markets. Design Thinking was popularized by David M. Kelley and Tim Brown of IDEO and Roger Martin of the Rotman School. A very good, short video on the topic was recently published by the Harvard Business Review blog . For a more detailed explanation please read the paper, "Design for Action" written by Brown and Martin.

Design Thinking process:

From a paper recently published by Creativity At Work, "Design Thinking is a methodology used by designers to solve complex problems, and find desirable solutions for clients. A design mindset is not problem-focused, it’s solution focused and action oriented towards creating a preferred future. Design Thinking draws upon logic, imagination, intuition, and systemic reasoning, to explore possibilities of what could be—and to create desired outcomes that benefit the end user (the customer)".

So how might Design Thinking be applied to your Quality improvement frameworks and roadmaps? The three major stages of Design Thinking are:
  1. Observe customer behavior; define unarticulated needs
  2. Ideate, Prototype, experiment and test
  3. Bring the new concept to life; open new markets
What differentiates Design Thinking from traditional Voice of Customer collection approaches is the emphasis placed on observation of behaviors rather than relying on customers' input to satisfaction surveys. Survey responses tend to validate Expected Quality and rarely reveal Exciting Quality opportunities (see "Kano Model"). In this way, Design Thinking is similar to Focus Panels and "Be the Customer" methods to better understand unarticulated customer needs. It is at this stage of Design Thinking that the Quality practitioner has the unique opportunity to innovate through the introduction and incorporation of Journey Mapping to document customer experiences throughout the value chain of the producer-customer relationship, from product awareness to purchase and after-sale touchpoints.

An example of customer journey map:

The stages in Design Thinking around Ideation and Prototyping should look very similar to your existing Product Development and Commercialization processes. Many such approaches use a stage-gate model to prototype, test, and refine product design to evaluate customer acceptance and verify production cost estimates. Quality's role in this stage should be to coach and consult in the proper use of experimental design to minimize experimentation costs and identify potentially important interactions of inputs and process variables to optimize performance of customer needs.

Another unique opportunity in the Design Thinking process for the Quality professional is in the final stage of bringing the new concept to life. With the help of social media the properly trained Quality professional can analyze customer / consumer feedback to validate areas of satisfaction and dissatisfaction, focusing on opportunities to build loyalty and engagement.

One can debate whether Design Thinking is really all that new or novel an approach to the value creation process. Design Thinking reinforces the power of understanding customer behaviors and unarticulated needs to deliver Exciting, innovative new product and service offerings for improved customer satisfaction and engagement... and potentially opening whole new markets. Per Linda Naiman (Creativity at Work), "Design Thinking minimizes the uncertainty and risk of innovation by engaging customers or users through a series of prototypes to learn, test and refine concepts". The Quality professional might also consider how Design Thinking and Journey Mapping can help him/her to innovate their professional services portfolio for increased customer satisfaction in teaching, coaching and consulting outcomes.

"The best way to predict the future is to create it" - Peter Drucker

Sunday, June 18, 2017

The Role of Quality in the Fourth Industrial Revolution

As part of its continuing series of Roundtable discussions among the "Influential Voices of Quality" participants, ASQ asks, "As Industry 4.0 continues to evolve, what can quality professionals do to ensure they will be an integral asset throughout this industrial revolution?"

First, let's begin with an operational definition of Industry 4.0.
Wikipedia defines Industry 4.0 as "the current trend of automation and data exchange in manufacturing technologies. It includes cyber-physical systems, the Internet of things and cloud computing. Industry 4.0 creates what has been called a "smart factory". Within the modular structured smart factories, cyber-physical systems monitor physical processes, create a virtual copy of the physical world and make decentralized decisions. Over the Internet of Things, cyber-physical systems communicate and cooperate with each other and with humans in real time, and via the Internet of Services both internal and cross-organizational services are offered and used by participants of the value chain".

Accenture released a report in January 2015 that concluded an industrial-scale version of Industry 4.0 could add $14.2 trillion to the world economy over the next 15 years.

Christoph Roser at AllAboutLean.com illustrates the four industrial revolutions:


So, the fourth industrial revolution is the move towards digitization including automation, robotics, artificial intelligence. The Smart Manufacturing Leadership Coalition (SMLC) in the United States is a non-profit organization comprising manufacturers, suppliers, technology firms, government agencies, universities and laboratories that share the goal of advancing the thinking behind Industry 4.0. Its purpose is to construct an open, smart manufacturing platform for industrial-networked information applications.

In a Forbes article dated June 20, 2016, Bernard Marr states that in order for a factory or system to be considered Industry 4.0, it must include:
  • Interoperability — machines, devices, sensors and people that connect and communicate with one another.
  • Information transparency — the systems create a virtual copy of the physical world through sensor data in order to contextualize information.
  • Technical assistance — both the ability of the systems to support humans in making decisions and solving problems and the ability to assist humans with tasks that are too difficult or unsafe for humans.
  • Decentralized decision-making — the ability of cyber-physical systems to make simple decisions on their own and become as autonomous as possible.

Having defined Industry 4.0, it is clear that assuring such inter-connectedness of software, sensors, devices and data centers requires a quality system that delivers data integrity, privacy and reliability in addition to assuring reliable, rugged, scaleable, fully-integrated systems and processes that seamlessly data-share between networks while consistently meeting producer, governmental and customer needs. Opportunities exist for the Quality professional to make significant, innovative contributions in areas of software quality assurance, reliability, process validation, environmental life testing and accelerated stress testing, Real Time Process Monitoring, multivariate statistics, 1st Principles and transfer functions, advanced calibration and big data analytics. Now, more than ever, product development and commercialization teams must assure reliable machine-human interface ease of use and real-time results-driven feedback loops. And, of course, discover even deeper insights to the ever-changing voice of customer (and voice of process) along with a comprehensive understanding of the customer experience throughout the value chain (e.g. journey maps), and assure that the organization is measuring the right key metrics to deliver success.

Industry 4.0 offers exciting new challenges to the Quality profession while building on our expertise of problem solving, process improvement, and managing the organizational white spaces to sustain customer focus and achieve operational excellence.

Wednesday, March 01, 2017

Enhancing & Sustaining the Role of Quality

The March 2017 ASQ Influential Voices roundtable discussion topic asks, "How can we prevent quality professionals from being perceived as a “thing of the past”? What adaptations need to occur in the quality industry as a whole and on the individual level to revitalize the industry and attract the next generation of quality professionals?  

In his Square Peg Musings blog response, Scott Rutherford attributes the source of this ASQ discussion topic to recent LinkedIn posts by others suggesting that the role of manufacturing quality appears to be backsliding to that of end-of-line product quality inspection and a system of Risk and Reward where defective product is either repaired or replaced in the field or the purchase price is refunded, with little focus on process improvement and prevention.

My years of experience in manufacturing as a quality professional, coupled with my experience as a Baldrige Examiner where I have evaluated organizations across the economic spectrum of healthcare, education, government, small business and non-profits leads me to conclude that the Quality profession is not dying, rather transforming and expanding into traditionally non-Quality departments or operations of the organization. For example, a key tenant of Lean is that everyone - at all levels of the organization - becomes a problem solver. Six Sigma belts are sometimes the Quality professional but more often the subject matter expert in a given discipline or function, and is positioned as a career development opportunity perhaps leading to future management or leadership positions. Many non-manufacturing organizations have replaced the traditional "Quality Dept." with employees staffed in departments responsible for "Customer/Patient Satisfaction" or "Operational Excellence" or the like. Many service industries have developed their own quality certifications specific to its own needs, mission, vision and culture.

Which begs the question, is there a fulfilling career opportunity for someone pursuing a role - or perhaps currently feeling trapped (i.e. career plateaued) in a current role - in the Quality function?
A real concern of mine is that many organizations seem satisfied by equating quality to standards conformance. Their quality professionals are primarily engaged in documenting procedures and requirements, auditing for compliance, and issuing reports. Though a required set of activities in certain compliance-based industries, this in itself is not a particularly engaging nor growth activity for the quality professional. A primary role of Quality is Business Process Management to improve the organizational white spaces - the communication and handoffs - between departments to assure operational excellence. By first focusing on and optimizing these internal customer-supplier relationships within the organization the Quality professional builds organizational capability to better serve the needs of its external customers. A Customer-first culture must be nurtured by leadership to enable organizational performance excellence. A genuine focus on the customer/patient always results in a more engaged workforce leading to process improvements, innovation and performance excellence.

So ... "What adaptations need to occur in the quality industry to revitalize the industry and attract the next generation of quality professionals?" Some of my thoughts:
  1. More ASQ focus and training on quality's role in driving and achieving innovation
  2. More ASQ focus and training to aid the technical Quality professional in making the successful transition to management and leadership.
  3. More ASQ involvement in K-12 education curriculum to increase certain quality concepts teaching in STEM courses (e.g. statistical thinking)
  4. More ASQ involvement with community colleges, universities and business schools to increase the awareness and discussion of quality principles and the Baldrige Criteria.
The successful Quality professional has adopted a philosophy of life-long learning beyond the areas of technical Quality and data analysis to broaden and strengthen his/her individual capabilities, in both "hard" and "soft" skills.
  1. Interpersonal Communication
  2. Social Media (for customer engagement)
  3. Change Management
  4. Leadership Behaviors
  5. Strategic Planning and Execution
  6. Community Involvement
  7. Coaching and Mentoring
The future of Quality is us. We cannot afford to sit idly by, or risk irrelevance; seek new opportunities and experiences. (e.g. What is the role of Quality in automation and robots?) "The best way to predict the future is to create the future" [Peter Drucker].