A Study on the Use and Effects of Quality Improvement Tools

By

Bjørn Andersen, Associate Professor, Department of Production and Quality Engineering,

Norwegian University of Science and Technology, N-7034 Trondheim, Norway

Henrik Sverre Løland, MSc.Eng. Student, Department of Production and Quality

Engineering, Norwegian University of Science and Technology, N-7034 Trondheim, Norway

ABSTRACT This paper describes a study with the objectives of understanding which
improvement tools produce the best effects in given situations. Enterprises were asked to
provide experiences with different improvement tools. In the analysis of the survey data,
improvement was defined as a function of; (1) actions, (2) variable attributes of the
improvement situation, and (3) non-variable attributes of the enterprise. A correlation analysis
was undertaken that revealed many findings. Several very strong correlation factors were
found linking some of these three factors to improvement results achieved. Six different
mechanisms of interplay between factors were identified that seemed to govern the
improvement outcome. Finally, a ranking of the tools was established based on the
improvement effects. These findings were merged into one improvement toolbox presenting
enterprises with guidelines to which tools to select and how to apply them to maximize the
probability for success.

KEYWORDS Quality improvement tools, improvement toolbox, improvement survey.

Bjørn Andersen, Ph.D., is an associate professor at the Norwegian University of Science and
Technology in Trondheim, Norway as well as scientific advisor to the research foundation
SINTEF. During his doctorate studies, he spent eight months at Rochester Institute of
Technology working on the subject of benchmarking and the results achievable through use
of the tool. He has co-authored and authored several books and papers and has been involved
in or managed several research and implementation projects on benchmarking, quality
improvement, productivity, and material and production management during the last years.

Henrik Sverre Løland…

1 Introduction – Improvement Tools and Areas of Competitive

Advantage
As everyone working with quality improvement and process innovations knows, there are a
very large number of different improvement tools or philosophies available for use. In
Norway, many, if not most, of these tools or philosophies have been applied in enterprises
around the country. However, very little work has been undertaken to analyze the use and
results achieved in actual implementations of them. Based on the resulting lack of
understanding of which tools seem to work better and what factors seem to govern the
success of an implementation of a tool or philosophy, a small study was undertaken during
the first half of 1997 to capture such experiences.

At the outset of the study, it was decided it was necessary to classify the different
improvement tools and philosophies in some way to render the survey in companies more

December 22nd, 1997 -1- Version 2.0

systematic. Such a classification could have been done in a number of ways, but possible
areas generating competitive advantage were seen as a good starting point. Seven main areas
were listed which, if a company were to excel within, was believed to lead to some form of
competitive edge compared to competitors:

ΠTime, especially delivery time and delivery precision.

 The customers’ perceptions of quality and service.
Ž The use and flow of information.
 Strategy and vision.
 Process orientation and process flow.
‘ Employees.
’ Overview and control with operations.

To classify the improvement tools and philosophies, they were attempted grouped according
to which of these seven areas they would mainly contribute to when being applied. This list is
far from complete, but reflects the most widely used tools and philosophies in Norway
currently. Furthermore, some tools obviously contribute to many of the seven areas for
competitive advantage. The area each single tool has been assigned to merely reflects the
most predominant feature. For the complete list of tools considered in this study, see the list
below.

1. Time
· Just-in-Time (JIT).
· Time Based Management (TBM).
· Single Minute Exchange of Die (SMED).
2. Quality and Service
· Concurrent Engineering.
· Design for Assembly (DFA).
· Design for Manufacturability (DFM).
· ISO 9000 to 9004.
· Statistical Process Control (SPC).
· Total Quality Management (TQM).
· Internal Quality Management System.
3. Information
· System/database for storage of experiences, knowledge, and information.
· Organization-wide IT system.
4. Strategy and Vision
· GAP-analysis.
· Strategy for customer focusing of the enterprise (LOTS).
· McKinsey’s 7S Model.
· Profit Impact of Marketing Strategy (PIMS).
5. Process flow
· Activity Based Costing (ABC).
· Work unit analysis.
· Benchmarking.
· Business Process Reengineering (BPR).
· Idealization.
· Total Productive Maintenance (TPM).
· Reliability Centered Maintenance (RCM).
6. Employees
· Incentive programs.
· Work environment programs.
7. Overview and Control

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· Systems for Internal Control

When reviewing this list, it is obvious that it represents a rather unstructured blend of tools
and philosophies that work at different levels in the organization. To clarify the differences
further, they were also placed in appropriate cells in the pyramid shown in Figure 1.

System Tools:
Quality Systems
IT Systems
Internal Control

Strategy Tools:
GAP-analysis, LOTS, PIMS, 7S

Holistic Philosophies:
JIT, TQM, TBM

Complex Improvement Tools:

Benchmarking, BPR

Improvement Tools:
SMED, Concurrent Engineering, DFA/DFM, TPM, SPC,
ABC, Work unit analysis, Idealization, Incentive programs,
Work environment programs

Figure 1 Improvement Tools and Philosophies

As part of the study, a detailed literature search was conducted and in-depth descriptions of
each tool and philosophy were generated. For those unfamiliar with some of these, please
consult the literature list attached to this paper.

2 Material and Methods

To conduct the study, a questionnaire was designed to identify any connections between how
the companies utilized the improvement tools and the results achieved in organizations. The
questionnaire contained questions related to the following issues:

· Characteristics of the company, e.g., size, sales, type of industry, etc.

· The improvement process, i.e., which tools were used, how, and in what situations. To
make sure that the enterprises fully understood what they were responding to, a four-page
appendix was attached to the questionnaire explaining the different tools.
· Internal resistance toward change.
· Achieved improvement results.
· Open-ended questions concerning general experiences and advice.

To the extent possible, the questions were designed to produce numerical answers in order to
enable comparison and statistical analysis of the data. Typically, a scale from 1 to 5 or 9,

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depending on the nature of the question, was used to rate different questions. Some examples
of questions are:

· To what extent was top management directly involved in the improvement project? To be
answered on a scale from 1 to 9, 9 indicating the highest extent of involvement.
· How many employees spent most of their time working in the improvement project? To
be answered by the actual number.
· How strong was the internal resistance to change before the improvement project was
started? To be answered on a scale from 1 to 9, 9 indicating the highest extent of
resistance.

The questionnaire along with an accompanying letter was sent to 17 enterprises, resulting in
13 returned completed questionnaires. All questionnaires had been answered extensively
including many and lengthy comments to the open-ended questions, and were mainly
answered by the quality manager or someone in a similar position in the enterprises. The
distribution of the respondent enterprises among industrial sectors was as follows:

· Manufacturing – 10 enterprises. Within these, there was a wide distribution among sub-
sectors.
· Service – 1 enterprise.
· Finance and administration – 2 enterprises.

With regard to size, the distribution among the companies of annual sales figures was as
follows:

· 10 to 30 million £ - 7 enterprises.
· 30 to 50 million £ - 3 enterprises.
· 50 to 100 million £ - 2 enterprises.
· More than 100 million £ - 1 enterprise.

Depending on which classification one uses, this meant that all of the respondent companies
in the study had to be considered relatively large and not SMEs.

3 Data Analysis
The entire survey was based on the following general framework for improvement:

Improvement = f (Actions + Variable attributes + Non-variable attributes)

In words, improvement was believed to be a function of one or more of the three entities:

ΠActions, the conscious activities the company performs before and during the
improvement process, e.g., improvement planning, top management support, etc.
 Variable attributes, attributes of the organization that the enterprise has the power to
change, e.g., resistance to change, improvement understanding, employee motivation, etc.
Ž Non-variable attributes, attributes of the organization not possible to impact by the
enterprise in the short term during the improvement process, e.g., sales, number of
employees, competition, etc.

December 22nd, 1997 -4- Version 2.0

The ultimate objective of the analysis of how these factors impacted the improvement
function was to arrive at conclusions pertaining to the connections between achieved
improvement results and:

· The improvement tool or philosophy used.

· The situation in which the improvement tool was used.
· Characteristics of the organization that used the tool.
· The improvement process and how the tool was used.

3.1 Numerical Response Variables

To determine any such connections, correlation factors (based on the covariance between the
two variables divided by the product of the standard deviation) were calculated for all pairs of
variables. The variables yielding numerical responses and thus encompassed by the
correlation analysis are presented in Table 1. In the table, the variables have been sorted
according to which variable type they are. The numbers correspond to the numbering of the
questions in the questionnaire and references to them in the remainder of the paper.

Variable attributes Non-variable attributes Actions

6. Employees motivated for
improvement
15. Communication of the
improvement objectives in
advance of the process
16. Internal resistance to the
improvement process in
advance of start-up
17. Internal resistance to the
improvement process during
the process
18. Average assessment of
the difficulties in using a tool
19. Satisfaction with the
achieved results compared to
expectations
Table 1 Variables included in the correlation analysis
1. Last year’s sales
2. Last year’s financial result
3. Number of employees in
total
4. Number of employees in
the part of the organization
affected by the improvement
5. The competition in the
most important market
segments
7. Experience in
improvement processes
before the new process was
started
8. The number of employees
that spent most of their time
on planning the improvement
project
9. The number of employees
that spent most of their time
on performing the
improvement project
10. The duration of the
planning
11. The duration of the
execution
12. Degree of top
management involvement in
the improvement process
13. Did the company have
clear plans for the future and
the activities of the
improvement process
14. To what extent were
results compared with
objectives of the
improvement process

December 22nd, 1997 -5- Version 2.0

3.2 Correlation Factors
The generated correlation factors are portrayed in Table 2.

# 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19
1 X 0,22 0,92 0,94 0,06 -0,01 -0,13 0,79 0,88 0,13 -0,41 -0,14 -0,03 0,00 0,13 -0,39 -0,16 0,34 0,40
2 0,22 X 0,77 0,91 0,76 -0,31 0,71 0,85 0,97 0,18 -0,77 -0,48 -0,25 0,55 -0,32 -0,07 0,53 -0,34 -0,10
3 0,92 0,77 X 0,93 0,26 -0,20 0,37 0,69 0,76 0,24 0,54 -0,11 -0,21 0,15 -0,39 0,29 0,30 -0,04 -0,11
4 0,94 0,91 0,93 X 0,12 -0,19 0,35 0,74 0,82 0,36 0,21 -0,13 -0,38 0,16 -0,33 0,24 0,25 -0,14 -0,06
5 0,06 0,76 0,26 0,12 X -0,15 0,56 0,32 0,35 -0,17 0,45 -0,14 0,54 0,57 0,52 -0,30 0,08 -0,23 0,37
6 -0,01 -0,31 -0,20 -0,19 -0,15 X -0,48 -0,44 -0,36 0,38 -0,49 0,68 0,15 -0,35 -0,09 -0,54 0,02 0,43 -0,20
7 -0,13 0,71 0,37 0,35 0,56 -0,48 X 0,79 0,69 -0,40 0,03 -0,48 0,09 0,38 0,19 -0,03 -0,10 -0,48 0,04
8 0,79 0,85 0,69 0,74 0,32 -0,44 0,79 X 0,95 0,24 0,20 -0,53 -0,23 0,22 -0,18 0,10 0,18 -0,14 -0,08
9 0,88 0,97 0,76 0,82 0,35 -0,36 0,69 0,95 X 0,40 -0,36 -0,46 -0,25 0,21 -0,26 0,06 0,27 -0,24 -0,07
10 0,13 0,18 0,24 0,36 -0,17 0,38 -0,40 0,24 0,40 X 0,01 -0,02 -0,15 -0,02 0,11 -0,35 -0,03 0,08 0,04
11 -0,41 -0,77 0,54 0,21 0,45 -0,49 0,03 0,20 -0,36 0,01 X 0,06 0,34 0,19 -0,33 0,76 -0,09 0,00 0,08
12 -0,14 -0,48 -0,11 -0,13 -0,14 0,68 -0,48 -0,53 -0,46 -0,02 0,06 X 0,42 0,10 -0,04 0,05 -0,15 0,38 0,23
13 -0,03 -0,25 -0,21 -0,38 0,54 0,15 0,09 -0,23 -0,25 -0,15 0,34 0,42 X 0,60 0,51 -0,22 -0,27 0,08 0,63
14 0,00 0,55 0,15 0,16 0,57 -0,35 0,38 0,22 0,21 -0,02 0,19 0,10 0,60 X 0,71 0,06 -0,18 -0,35 0,85
15 0,13 -0,32 -0,39 -0,33 0,52 -0,09 0,19 -0,18 -0,26 0,11 -0,33 -0,04 0,51 0,71 X -0,45 -0,21 -0,20 0,71
16 -0,39 -0,07 0,29 0,24 -0,30 -0,54 -0,03 0,10 0,06 -0,35 0,76 0,05 -0,22 0,06 -0,45 X 0,06 -0,02 -0,04
17 -0,16 0,53 0,30 0,25 0,08 0,02 -0,10 0,18 0,27 -0,03 -0,09 -0,15 -0,27 -0,18 -0,21 0,06 X 0,24 -0,44
18 0,34 -0,34 -0,04 -0,14 -0,23 0,43 -0,48 -0,14 -0,24 0,08 0,00 0,38 0,08 -0,35 -0,20 -0,02 0,24 X -0,14
19 0,40 -0,10 -0,11 -0,06 0,37 -0,20 0,04 -0,08 -0,07 0,04 0,08 0,23 0,63 0,85 0,71 -0,04 -0,44 -0,14 x

Table 2 Correlation factors

Based on general interpretation norms for correlation factors, the following meaning was
attached to different intervals, irrespective of the sign of the factor:

· 0,00 to 0,30 – negligible.

· 0,30 to 0,50 – medium strength correlation.
· 0,50 to 1,00 – high strength correlation.

When removing the correlation factors that represented negligible connections, the simplified
table looked as in Table 3.

# 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19
1 X 0,92 0,94 0,79 0,88 -0,41 -0,39 0,34 0,40
2 X 0,77 0,91 0,76 -0,31 0,71 0,85 0,97 -0,77 -0,48 0,55 -0,32 0,53 -0,34
3 0,92 0,77 X 0,93 0,37 0,69 0,76 0,54 -0,39 0,30
4 0,94 0,91 0,93 X 0,35 0,74 0,82 0,36 -0,38 -0,33
5 0,76 X 0,56 0,32 0,35 0,45 0,54 0,57 0,52 -0,30 0,37
6 -0,31 X -0,48 -0,44 -0,36 0,38 -0,49 0,68 -0,35 -0,54 0,43
7 0,71 0,37 0,35 0,56 -0,48 X 0,79 0,69 -0,40 -0,48 0,38 -0,48
8 0,79 0,85 0,69 0,74 0,32 -0,44 0,79 X 0,95 -0,53
9 0,88 0,97 0,76 0,82 0,35 -0,36 0,69 0,95 X 0,40 -0,36 -0,46
10 0,36 0,38 -0,40 0,40 X -0,35
11 -0,41 -0,77 0,54 0,45 -0,49 -0,36 X 0,34 -0,33 0,76
12 -0,48 0,68 -0,48 -0,53 -0,46 X 0,42 0,38
13 -0,38 0,54 0,34 0,42 X 0,60 0,51 0,63
14 0,55 0,57 -0,35 0,38 0,60 X 0,71 -0,35 0,85
15 -0,32 -0,39 -0,33 0,52 -0,33 0,51 0,71 X -0,45 0,71
16 -0,39 -0,30 -0,54 -0,35 0,76 -0,45 X
17 0,53 0,30 X -0,44
18 0,34 -0,34 0,43 -0,48 0,38 -0,35 X
19 0,40 0,37 0,63 0,85 0,71 -0,44 x

Table 3 Simplified correlation overview

In
Figure 2, a graphic representation of Table 3 is given. Please notice that in order to enhance
the readability of this figure, the correlation factors between 4 and 7, 8, and 9 have been
omitted since they are almost identical to those between 3 and 7, 8, and 9. In this figure,
circles are used to indicate variable attributes of the company, rhombs for non-variable

December 22nd, 1997 -6- Version 2.0

 process.

0,69
0,76

4. Number of 0,37
3. Total 0,79
0,93 employees in

December 22nd, 1997

number of 0,94 unit to be imp.
0,92
employees 0,36
0,32

1. Sales 0,34
-0,38
0,30
17. Internal
resustance to

Parameter
0,95
change during
the imp. 0,88 9. Number of -0,46
process -0,35 -0,39 employees 100%
18. Average
0,35 involved in the
perceived difficulty
5. Degree of execution
-0,36 in using the tool
competition
0,40

0,43
-0,36 0,69

0,54 10. Duration of the

-0,33 -0,30 planning

-7-
0,57 0,38 6. Degree of
-0,33 -0,35 motivated -0,48
16. Internal -0,54 employees before
resistance to the the imp. process
-0,49

responses
0,52 imp. process 0,76
before start 0,45
0,56
-0,40
0,54
-0,44
-0,48
0,38

-0,35 8. Number of
14. Comparison employees involved in
0,68
of results with 0,79

strength of the correlation factors, they are portrayed in Table 4:

11. Duration of the 7. Experience the planning
-0,45 goals execution from previous
imp. proc.
-0,53
0,60
0,71
-0,33 -0,48
0,34 12. Degree of
15. 0,38 involved top
Understanding of management
the imp. process
among the 0,51 13. Clear plans for
employees progress and activities
before execution

3.3 Analysis of Parameters in Direct Correlation to Achieved Results

0,42

Version 2.0
Figure 2 Graphical representation of the correlations between the numerical survey

Correlation with improvement results

attributes of the enterprise, and squares for actions undertaken during the improvement

From the massive correlation table presented above, the factors that indicated a direct
relationship between variables and the result variable, i.e., the degree to which the
improvement results were satisfactory, were extracted. Sorted according to descending
14. Comparison of results with goals 0,85
15. Understanding of the improvement process 0,71
among the employees in advance of execution
13. Clear plans for progress and activities in the 0,63
improvement process
17. Internal resistance toward change during the -0,44
improvement process
1. Company sales 0,40
5. Degree of competition 0,37
Table 4 Significant correlations between dimensions of improvement and results of
improvement

The correlation analysis showed that:

· Enterprises that planned the improvement process thoroughly and also monitored progress
compared to objectives, were most satisfied with the improvement results. The
explanation probably lies in a better-structured improvement process resulting from a
clear vision of what the objectives and ways to achieve them are.
· The better the understanding of the improvement process among the employees, the better
the results. Clearly, this shows that even if an awareness process costs and takes time, it
pays off. On the other hand, the larger the internal resistance toward the project, the
poorer the results.
· Higher sales generally means that the enterprise controls more resources, both in terms of
money and people, that can be exploited in such an improvement process.
· In markets of more fierce competition, the needs for improvement are perhaps more easily
visible. Thus, the improvement projects might be better aligned with true improvement
needs and yield more rewarding results.

In addition, most of these variables also seem to be correlated to each other, thus resulting in
synergy effects and reinforcing the effects of others.

3.4 Analysis of Variable Parameters of the Enterprises

To analyze which of the variable parameters, i.e., actions and variable attributes,
available to an enterprise for impacting that seemed to influence the achieved results,
these issues were studied in some more detail. To give an overview of the connections
involved, these parameters were isolated in
Figure 3, where the shaded boxes represent factors that correlated directly with achieved
results.

December 22nd, 1997 -8- Version 2.0

 Figure 3 Correlations between action, variable attributes, and achieved results

Based on these correlation factors, the contours of some mechanisms of impact could be seen
in the data material. Further studies of these possible mechanisms were undertaken by the
authors as a follow-up to the correlation analysis. What seemed to be relevant connections are
listed below:

December 22nd, 1997 -9- Version 2.0

ΠIntensity, connections between the intensity both before and during the improvement
process and the variables number 12 (top management involvement), 6 (employee
motivation), 16 (internal resistance before start), 7 (experience with improvement
processes), and 18 (difficulties in using the tools). It seems as if an increased feeling of
intensity surrounding the improvement situation works favorably pertaining to all of these
five variables. The mechanism is depicted in Figure 4.

Increased intensity (e.g., competition)

6. More motivated 16. Lower internal 7. Quicker

12. More employees in resistance to the accumulation of
involved top advance of the improvement experience from
management improvement process before improvement
process start processes

18. The
improvement tools
are perceived as
easy to use

Figure 4 Mechanism 1 – Intensity in the improvement situation

 Motivation, resistance, and understanding, connections between the variables 6 (employee

motivation), 16 (internal resistance before start), and 15 (pre-process employee
understanding). An established high degree of motivation among the employees correlates
strongly negatively with internal resistance before the improvement process is started. The
internal resistance also shows negative correlation with the employees’ understanding of
the improvement process. Thus, by maximizing 6, minimizing 16, or maximizing 15, the
company can increase the chances of a successful improvement process. The mechanism
is illustrated in Figure 5.

6. Increase the 16. Pre-process 15. The pre-process

employee resistance is understanding is
Increased improvement
motivation reduced improved

16. Reduce the

pre-process
resistance

Figure 5 Mechanism 2 - Motivation, resistance, and understanding toward the

improvement project

Ž Top management involvement, connections between the variables 12 (top management

involvement), 18 (perceived tool difficulty), 13 (clear plans), and 14 (comparison of
results with objectives). Generally, there is a correlation between tools that are seen as

December 22nd, 1997 - 10 - Version 2.0

 more difficult to apply and the level of top management involvement. This is probably
due to a higher propensity to get involved when tools that the enterprise views as difficult
to use are being applied. Furthermore, there is a strong chain of correlation links between
top management involvement, clear plans, monitoring of the progress with these plans and
resulting achievements, and increased improvement. This chain of connections is shown
in Figure 6.

18. More
difficult
14. More comparison
tool
of results with
objectives

13. Clearer
12. Higher
plans for
top management Increased improvement
progress and
involvement
activities

Figure 6 Mechanism 3 - Top level involvement in the improvement project

 Complexity, connections between the complexity of the improvement process and the
variables 10 (duration of the planning), 16 (pre-process internal resistance), 11 (duration
of the execution), and 15 (pre-process employee understanding). The internal resistance is
negatively correlated to the duration of the planning. This can be interpreted to mean that
allowing the pre-process planning to take its time, the internal resistance will decrease.
However, the planning duration does not correlate with neither increased employee
understanding nor clear plans. The duration of the execution correlates strongly with the
internal resistance, i.e., the higher the resistance, the more likely that the process will take
time to accomplish or vice versa. As opposed to this, there is negative correlation between
the pre-process understanding among the employees and the execution duration. Finally,
there is strong correlation between the pre-process employee understanding of the
improvement process and the results achieved in that process. This led to the following
mechanism, see Figure 7.

Increased complexity

11. More 15. Reduced

extensive process, pre-process
i.e., longer employee
duration understanding

16. Increased
pre-process Lower achieved
internal improvement
resistance

Figure 7 Mechanism 4 – Complexity of the improvement project

December 22nd, 1997 - 11 - Version 2.0

 Top level versus employee involvement, connections between the variables 12 (top
management involvement), 8 (employees involved in the planning), and 9 (employees
involved in the execution). The correlation analysis showed that the more involved the top
management was in the improvement process, the less involved the employees were in
both planning and execution. This might reflect that when the top management does get
involved in an improvement project, they also do much of the work and delegate less of
the tasks to lower level employees. There is, however, no direct correlation between any
of the latter two variables and achieved results.
‘ Internal resistance, connections between the variables 16 (internal resistance in advance of
the improvement process), 17 (internal resistance during the improvement process), and
19 (achieved results). A rather surprising finding was that the internal resistance during
the process did not correlate with any other variables than the achieved improvement
results. Furthermore, the resistance before the process did not correlate with the achieved
results (-0,04). On the other hand, this variable was, as we have seen, important in many
of the other improvement-related mechanisms.

There was also reason to believe that there might exist a function between the two
resistance variables:

Resistance during the process = Resistance in advance x Resistance-reducing efforts

In fact, there was a correlation of 0,33 between the change in resistance (resistance before
– resistance during) and achieved results. In other words, the larger the change in
resistance, the better results and vice versa. The lack of correlation between the two
resistance variables can then be caused by resistance-reducing efforts. Such efforts were
also investigated in the survey and some dominating factors were identified. These, along
with the general topography of this mechanism, are illustrated in Figure 8. The numbers,
e.g., 0,23 attached to additional information, indicate that 23% of the organizations had
experienced this phenomenon.

Inadequately
Reference coordinated
to early- top
stage results management
Promises
of more
0,23 16. Internal 0,15
Lack of
interesting resistance
resources
work 0,38 before the 0,31
process
Disagreement
Additional between
0,23 0,15
information management
and employees

17. Less 17. Increased

resistance resistance
during the during the
process process

Higher degree Lower degree

of improvement of improvement

Figure 8 Mechanism 6 - Internal resistance

December 22nd, 1997 - 12 - Version 2.0

3.5 Analysis of Verbal Responses
Many of the respondents provided input of a verbal nature to the survey’s open-ended
questions. These were difficult to analyze with the same degree of precision as the numerical
data. However, some interesting hypotheses emerged from these answers as well:

A. Educational level in the organization; the higher percentage of skilled operators, the more
willing to change the organization seemed to be.
B. Organizational type; process-oriented organizations were more willing to change than
functionally oriented companies.
C. Nicknames; companies that named their improvement processes with nicknames that
become familiar and generally accepted throughout the organization seemed to create
more enthusiasm for these processes.
D. Triggering impulse; companies initiating change processes out of a general desire to
improve more often experienced more indifference among the employees than when there
was a need to improve in order to survive.
E. Type of plans; the more thorough the activity and resource plans for the improvement
project were, the more seriously the project was perceived by the employees.

3.6 Indicators of the Improvement Effects of the Tools

To undertake an analysis of the effects of the individual tools and philosophies, two
indicators of a tool’s improvement effect were defined. First, the survey respondent
enterprises indicated which process or area of the organization they wanted to improve by
using a specific tool or philosophy, for instance delivery precision. At the end of the
questionnaire, the companies were also asked to explain which processes or areas had been
improved as a result of the improvement project. Depending on whether the area desired to
improve in fact was improved, it was possible to assess whether the tool worked as intended.
Thus, the first indicator was:

Improvement effect of the tool, indicator 1 = Degree of achieved objectives

Secondly, the degree to which the enterprises that had applied the tools were satisfied with
the achieved results said something about their effects. The second indicator was therefore
defined as:

Improvement effect of the tool, indicator 2 = Assessment of achieved results

In sum, these two indicators were combined into the following expression:

Improvement effect of the tool = Indicator 1 x Indicator 2 » “Area Precision” x “Improvement

Contribution”

Table 5 contains the data for the two indicators and the total improvement effect for the tools
that had been applied by one or more of the respondent companies. In addition, the table
shows how many of the respondents that had applied each tool and how difficult they were
perceived to be in use.

December 22nd, 1997 - 13 - Version 2.0

 Improvement process or Improvement tool or Extent of use Degree of Average Improvement Average
area philosophy among the achieved achieved effect of the perceived
respondents objectives improvement tools difficulty in
(%) (Indicator 1) results (I1 x I2) use
(%) (Indicator 2) (0-900) (1-5)
(1-9)
Delivery time and JIT 62 100 5,8 575,0 3,8
precision
Product development SMED 23 67 4,7 311,1 4,0
DFM 15 100 5,0 500,0 3,5
Quality ISO 9001-4 38 80 5,6 448,0 2,2
SPC 23 100 5,7 566,7 3,7
TQM 46 67 4,8 322,2 4,0
Own quality system 8 100 7,0 700,0 2,0
Business processes ABC 8 0 5,0 0,0 3,0
Work unit analysis 8 100 7,0 700,0 3,0
BM 54 86 4,7 404,1 2,6
BPR 54 86 5,1 440,8 4,3
Idealizing 15 100 6,0 600,0 3,5
Maintenance TPM 8 100 5,0 500,0 4,0
Re-use of information Knowledge database 8 100 7,0 700,0 4,0
New IT system 31 75 5,8 431,3 4,5
Strategy/vision GAP 15 100 6,0 600,0 3,0
Customer adaptation 15 100 6,0 600,0 4,5
PIMS 15 50 6,0 300,0 2,0
Employee motivation Incentive program 31 25 6,0 150,0 2,8
Work environment 31 25 4,5 112,5 3,8
program
Overview and control Internal control 15 0 4,0 0,0 3,5

Table 5 The improvement effects of the tools

Based on Table 5, it was now possible to generate a concluding ranking of the improvement
effects of the different tools and philosophies. This ranking is shown in Table 6, where tools
used by more than 20% of the respondent enterprises are in bold.

Ranking Improvement tools or philosophy Improvement effect (0-900)

1 Work unit analysis 700,0
2 Knowledge database 700,0
3 Idealizing 600,0
4 GAP 600,0
5 Customer adaptation 600,0
6 JIT 575,0
7 SPC 566,7
8 DFM 500,0
9 TPM 500,0
10 ISO 9001-4 448,0
11 BPR 440,8
12 New IT system 431,3
13 BM 404,1
14 TQM 322,2
15 SMED 311,1
16 PIMS 300,0
17 Incentive program 150,0
18 Work environment program 112,5
19 ABC 0,0
20 Internal control 0,0

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 Table 6 Ranking of the tools according to improvement effects

3.7 Verbal Responses Collected in the Survey

In addition to the numerical answers, the respondent enterprises were also asked to input any
explanations or useful hints in a verbal manner. For most of the questions, these responses
were not very useful. However, when presented with the questions “What is the most
valuable knowledge you can give to someone starting an improvement project for the first
time?” gave some hints that could be useful for beginners in the area of business process
improvement:

· Things take time, results do not come easy, patience, a long-term view and endurance are
crucial in improvement projects.
· If possible, plan the project so that only one issue is dealt with at the time.
· Initiate improvement projects out of strength when the company is doing well, do not
consider improvements a fix to poor results.
· Create top management support and decide and define what the primary objectives of the
project are.
· You can never be well enough prepared.
· Create teams with separate areas of responsibility during the execution of the project,
preferable led by highly motivated sponsors.
· Allow the necessary resources to be available for the project.
· Make sure there is a steady flow of information about the progress and results of the
project to the employees.
· Be realistic when it comes to expectations of progress.

3.8 Sources of Error

The study resulted in a small data set. In fact, it contained only 13 completed questionnaires,
a rather limited data set. This of course introduced some possible error sources in the study:

· Did the respondent group represent a cross section of companies in Norway that had used
one or more improvement tools? Perhaps not, but the selected enterprises were targeted to
represent different geographical areas, industries, and sizes. Still, the results could
certainly have changed if a larger sample had been collected and the results must be
viewed in this light.
· The sample size of 13 data sets rendered it possible to undertake the performed
correlations analysis. However, a larger sample size would have made the analysis more
solid and eliminated some possible statistical inconsistencies.

4 Conclusions
The study did clearly illustrate that the success achievable when applying a certain tool is
strongly dependent on a number of factors that not only directly impact the outcome, but
which are also linked in a complex network. Actions seen as favorable for improvement
might negatively impact other factors reducing the effects of them.

When posing the question which tool to use, the study showed that the enterprise’s ability to
change is of pivotal importance to the decision. The fact that some companies succeed in
applying a specific tool while others do not, seem to rely on how the ability to change is

December 22nd, 1997 - 15 - Version 2.0

developed before and during the improvement project. Four of the six parameters that directly
correlated with the achieved results, can be influenced during the improvement process. The
key challenge for management during such processes is thus to maximize the organization’s
ability to change.

Improvement projects where highly complex or combinations of improvement tools have

been applied, were often seen to have failed or produced results poorer than expected.
According to the study, this did not only rely on available resources in the organization, but
also on the fact that the organizations were unable to handle the extent of change advocated
by the tools. Therefore, the boundaries for the improvement ambitions should be set so as to
balance the deployable change ability of the organization. The tool box designed based on the
study is supposed to aid the achievement of this balance by giving guidelines for the selection
of:

ΠThe right tool compared to what the organization wants to improve.

 The right tool related to the organization’s initial ability to change.
Ž The right overall strategy for the improvement process based on the situation facing the
company.
 Activities to improve the ability to change before and during the improvement process.

Figure 9 presents the overall improvement toolbox that can be used to design an improvement
project to maximize the likelihood of success.

December 22nd, 1997 - 16 - Version 2.0

 work.
Attributes that lead to
higher willingness to
change in the company
High sales
Fierce competition
Part of
mechanism
number: Strategy A: Strategy B: Measures to achieve a favorable
Blue Cheese Approach, Create an image that application situation
careful progress improvements are absolutely Factors correlated with Part of mech-

6 Literature
1 necessary results anism number:
Companies with high willing- Create a high understanding
ness to change can follow: Strategy related to company situation of the improvement process

December 22nd, 1997

Companies with low willing- in advance of it and
2 4
ness to change should follow: Counteract high internal
resistance to change during
Hard-to-use tools I II the process 6
New IT system 431,3 4,5 Part of
Strategy for customer adaptation 600,0 4,5 Consider: hypothesis:
Business Process Reengineering (BPR) 440,8 4,3 Increasing the percentage of
Desired skilled operators
improvement area Reduction of set-up times (SMED) 311,1 4,0
A
Total Quality Management (TQM) 322,2 4,0 Process-orienting the company B
Delivery time and Total Productive Maintenance (TPM) 500,0 4,0
precision
Knowledge systems 700,0 4,0
Just-In-Time (JIT) 575,0 3,8
Product development Work environment programs 112,5 3,8
Measures with a favorable

- 17 -
and design
Statistical Process Control (SPC) 566,7 3,7 effect on the execution of
Design for Manufacturability (DFM) 500,0 3,5 the improvement process
Quality
Idealizing 600,0 3,5 Actions correlated with Part of mech-
Internal Control system 0,0 3,5 results anism number:
Time Based Manufacturing (TBM) Consistently compare results
Business processes
with stated objectives 3
Make clear plans for progress
Easier-to-use tools I II and activities
Maintenance 3
Profit Imp. of Mark. Strategy (PIMS) 300,0 2,0 Ensure top management

Figure 9 The improvement toolbox

ISO 9001-4 448,0 2,2 direct involvement 1 and 3
Reuse of information
Benchmarking (BM) 404,1 2,6 Part of
Incentive Programs 150,0 2,8 Consider: hypothesis:
Activity Based Costing (ABC) 0,0 3,0 Aggressively nicknaming the
Strategy/vision improvement process C
Work unit analysis 700,0 3,0
Make clear the seriousness
GAP-analysis 600,0 3,0
involved in the reasons for
Employee motivation Concurrent Engineering initiating the improvements
Design for Assembly (DFA)
D
Increase the level of detail
Rel. Centered Maintenance (RCM) and extent of the activity
Overview and control McKinsey’s 7S model and resource plans E
I = Improvement effect II = Approximate difficulty in use

Version 2.0
· Andersen, Bjørn, Haavardtun, Lars Johan, and Strandhagen, Jan Ola: Kompendium i
references to literature in the paper. However, during the study, much literature was studied.

MPS-systemer (Translated from Norwegian: Textbook in Material and Production

Since the paper itself more or less only describes the study that was undertaken, there are no

The following list summarizes some of the most important literature scanned during this
 Management), Department of Production and Quality Engineering, NTNU, Trondheim,
Norway, 1997.
· Andersen, Bjørn, Moe, Einar Printz, Moseng, Bjørn, and Rolstadås, Asbjørn:
Produktivitet og konkurranseevne i norske bedrifter - på vei mot TOPPen (Translated
from Norwegian: Productivity and Competitiveness in Norwegian Enterprises – On
the Way to the TOP), Ad Notam, Oslo, Norway, 1996.
· Andersen, Bjørn: The Results of Benchmarking and a Benchmarking Process Model,
Ph.D. Dissertation published at the Department of Production and Quality Engineering,
NTH, Trondheim, Norway, 1995.
· Aune, Asbjørn: Kvalitetsstyrte bedrifter (Translated from Norwegian: Quality-
Managed Enterprises), Ad Notam, Oslo, Norway, 1996.
· Bockerstette, Joseph A. and Shell, Richard L.: Time Based Manufacturing, McGraw-
Hill, 1993.
· Born, Gary: Process Management to Quality Improvement: The Way to Design,
Document, and Re-engineer Business Systems, John Wiley, 1994.
· Committee of Sponsoring organizations of the Treadway Commission: Internal control -
integrated framework, 1994.
· Cristopher, Martin: Logistics: The Strategic Issues, Chapman & Hall, 1992.
· Durö, Robert: Konkurrensöverlägsenhet: I tio konkreta steg (Translated from Swedish:
Competitiveness: In Ten Specific Steps), Liber, Stockholm, Sweden, 1988.
· Eccles, Tony: Succeeding with Change: Implementing Action-Driven Strategies,
McGraw-Hill, 1994.
· Federal Aviation Administration: Business Process Improvement (Reengineering),
Handbook of Standards and Guidelines, 1995.
· Gellerman, Saul W.: Motivation and Productivity, American Management Association,
1963.
· Grøtte, Hauknes, Qvistgaard, Engh, and Persson: Håndbok for flytorientert MPS
(Translated from Norwegian: Handbook for Flow-Oriented Production Planning and
Control), Tapir, Trondheim, Norway, 1989.
· Hotvedt, Einar and Westhagen, Harald: Samarbeid om bedriftsutvikling (Translated
from Norwegian: Cooperation on Enterprise Development), Tanum-Norli, Oslo,
Norway, 1984.
· http://www.asedb.no.
· http://www.capgemini.no.
· http://www.sap.com.
· Institute of Management Accountants: Practices and Techniques: Implementing
Activity-Based Costing, Statement on Management Accounting, Statement no. 4T, 1993.
· Ishiwata, Junichi: Productivity through Process Analysis, 1991.
· ISI: Markedsdrevet IT-logistikk, Et viktig middel for internasjonal konkurranseevne
(Translated from Norwegian: Market-Driven IT: An Important Source for
International Competitiveness), Theme Book no. 25, Oslo, Norway, 1993.
· Johannessen, Jon-Arild and Olaisen, Johan: Endringsledelse: Mål og resultatstyring i
privat og offentlig virksomhet (Translated from Norwegian: Change Management:
Objectives and Result Management in Private and Public Sector), Fagbokforlaget,
Oslo, Norway, 1994.

December 22nd, 1997 - 18 - Version 2.0

· Karlöf, Bengt: Håndbok i strategi for bedrifter og organisasjoner (Translated from
Norwegian: Handbook in Strategy for Companies and Organizations), Damm, Oslo,
Norway, 1989.
· Killing, J. Peter: Perspectives for Managers, Managing Change: The Urgency Factor,
IMD, vol. 29, Issue no. 1, February, 1997.
· LaMarsh, Jeanenne: Changing the Way We Change: Gaining Control of Major
Operational Change, Addison-Wesley, 1995.
· Persson, Göran and Virum, Helge (editors): Logistikk for konkurransekraft (Translated
from Norwegian: Logistics for Competitiveness), Ad Notam, Oslo, Norway, 1995.
· Peters, Glen and Price Waterhouse: Riding the Wave: Imagining Your Future, CD-
ROM/book, 1996.
· Porter, Michael E.: Competitive Advantage: Creating and Sustaining Superior
Performance, Free Press, 1985.
· Price Waterhouse: Paradox Principles: How High-Performance Companies Manage
Chaos, Complexity, and Contradiction to Achieve Superior Results, 1996.
· SAP AG: Efficient R/3 Implementation, Business Engineering Workbench, CD-ROM,
1996.
· Skorstad, Egil: Lean Production: Conditions of Work and Worker Commitment,
Economic and Industrial Democracy, vol. 15, no. 3, 1994.
· Solberg, Svein Linge and Andersen, Åge Borg: I forkant: Konkurransefordeler ved
strategisk bruk av informasjonsteknologi (Translated from Norwegian: Ahead:
Competitiveness Advantage through Strategic Use of UT), Tano, Oslo, Norway, 1990.
· Spencer, Lyle M.: Reengineering Human Resources: Achieving Radical Increases in
Service Quality - With 50% To 90% Cost And Head Count Reductions, Wiley, 1995.
· Statoil: Benchmarking in Statoil, 1994.
· von Krogh, Georg and Roos, Johan: Fra kunnskap til konkurransefortrinn (Translated
from Norwegian: From Knowledge to Competitiveness), Norwegian School of
Management, Oslo, Norway, 1992.
· Wheelen, Thomas L. and Hunger, J. David: Strategic Management and Business Policy,
Addison-Wesley, 1986.
· Willoch, Bjørn-Erik: Business Process Reengineering - en praktisk innføring og
veiledning (Translated from Norwegian: Business Process Reengineering – Practical
Introduction and Guidelines), Fagbokforlaget, Oslo, Norway, 1994.

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