The Framework of the European Foundation for Quality Management.

Explanation EFQM
Total Quality Management (TQM) is the idea that quality control should not be left to a quality controller standing at the end of a production line. (Checking the final output). It is (or should be) something that permeates an organization from the moment its raw materials arrive, until the moment its finished products leave the premises. WHAT IS THE EFQM FRAMEWORK. DESCRIPTION The EFQM Model is a non-prescriptive TQM framework based on nine criteria. Five of these are 'Enablers' and four are 'Results'. The 'Enabler' criteria are covering what an organization does. The 'Results' criteria are covering what an organization achieves. 'Results' are caused by 'Enablers' and feedback from 'Results' help to improve 'Enablers'. The EFQM Model recognizes that there are many approaches to achieving sustainable excellence in all aspects of performance. It is based on the assumption that excellent results with respect to Performance, Customers, People and Society are achieved through Leadership driving Policy and Strategy, that is delivered through People Partnerships and Resources, and Processes. EFQM is a non-prescriptive framework that recognizes there are many approaches to achieving sustainable excellence. Within this nonprescriptive approach there are some fundamental concepts which underpin the EFQM Model: CONCEPTS OF THE EFQM MODEL

Results Orientation. Achieve results that delight all the organization's stakeholders.
Leadership & Constancy of Purpose. Visionary and inspirational leadership, coupled with constancy of purpose.

Customer Focus. Create sustainable customer value.

Management by Processes & Facts. Manage the organization through a set of interdependent and interrelated systems, processes and facts. People Development & Involvement. Maximize the contribution of employees through their development and involvement. Continuous Learning, Innovation & Improvement. Challenge the status quo and effecting change by using learning to create innovation and improvement opportunities.
Corporate Social Responsibility. Exceed the minimum regulatory framework in which the organization operates and to strive to understand and respond to the expectations of their stakeholders in society. The EFQM Model is one of the most widely used organizational frameworks in Europe. USES OF EFQM The EFQM model can be used for the following purposes:

Partnership Development. Develop and maintain value-adding partnerships.

To assess organizations. Thus identifying where to focus improvement activity. Benchmarking. Strategy reviews and creation. Basis for applying for the European Quality Award and many national quality awards.

EFQM TOOLS The following tools are provided:

RADAR Scoring Matrix - Results, Approach, Deployment, Assessment and Review Results - This covers what an organization achieves. In an excellent organization the results will show positive trends and/or sustained good performance, targets will be appropriate and met or exceeded, performance will compare well with others and will have been caused by the approaches. Additionally, the scope of the results will address the relevant areas. Approach - This covers what an organization plans to do and the reasons for it. In an excellent organization the approach will be sound - having a clear rationale, well-defined and developed processes and a clear focus on stakeholder needs, and will be integrated - supporting policy and strategy and linked to other approaches where appropriate. Deployment - This covers the extent to which an organization uses the approach and what it does to deploy it. In an excellent organization the approach will be implemented in relevant areas, in a systematic way. Assessment & Review - This covers what an organization does to assess and review both the approach and the deployment of the approach. In an excellent organization the approach, and deployment of it, will be subject to regular measurement, learning activities will be undertaken, and the output from both will be used to identify, prioritise, plan and implement improvement. PATHFINDER Card The Pathfinder card is a Self-Assessment tool for identifying opportunities for improvement. Its purpose is to assist in the identification of improvement opportunities through Self-Assessment and to help build improvement plans. It is not a scoring tool, rather it is a series of questions designed to be answered quickly whilst undertaking a Self-Assessment. This tool can be used at either criterion or sub-criterion level.

Continuously develop the workforce maturity. Explanation People CMM.

WHAT IS PEOPLE CMM? DESCRIPTION The People Capability Maturity Model (People CMM) framework is maintained by the Carnegie Mellon SEI. It helps organizations to develop the maturity of their workforce, and to address their critical people issues. Based on current best practices in fields such as: human resources, knowledge management, and organizational development, it can guide organizations in improving their processes for managing and developing their workforces. It helps organizations to characterize the maturity of their workforce practices, to establish a program of continuous workforce development, to set priorities for improvement actions, to integrate workforce

development with process improvement, and to establish a culture of excellence. People CMM provides a roadmap for implementing workforce practices that continuously improve the capability of an organization's workforce. Since an organization cannot implement all of the best workforce practices in an afternoon, a step by step approach is taken. Each progressive level of the model produces a unique transformation in the culture of an organization. In order to achieve this, organizations are equipped with more powerful practices to attract, develop, organize, and motivate its workforce. Thus, People CMM establishes an integrated system of workforce practices that matures through increasing alignment with the organization's business objectives, performance, and changing needs. TEN PRINCIPLES OF PEOPLE CMM. PHILOSOPHY 1. In mature organizations, the capability of the workforce is directly related to business performance. 2. Workforce capability is a competitive issue and a source of strategic advantage. 3. Workforce capability must be defined in relation to the strategic business objectives of the organization. 4. Knowledge-intense work can shift the focus from job elements to workforce competencies. 5. Capability can be measured and improved at multiple levels. Including individuals, workgroups, workforce competencies, and the organization. 6. An organization should invest in improving the capability of those workforce competencies that are critical for its core competency as a business.

7. 8.

Operational management is responsible for the capability of the workforce. The improvement of workforce capability can be pursued as a process composed from proven practices and procedures. 9. The organization is responsible for providing improvement opportunities, while individuals are responsible for taking advantage of them. 10. Since technologies and organizational forms evolve rapidly, organizations must continually evolve their workforce practices and develop new workforce competencies.

The People Capability Maturity Model consists of five maturity levels that establish successive foundations:

For shaping the workforce the organization needs to accomplish its future business plans. Each maturity level is a well-defined evolutionary plateau that institutionalizes new capabilities for developing the organization's workforce. By following the maturity framework, an organization can avoid introducing workforce practices that its employees are unprepared to implement effectively. Five stages of the People CMM framework 1. Initial Level. Typical characteristics: Inconsistency in performing practices, Displacement of responsibility, Ritualistic practices, and Emotionally detached workforce. 2. Managed Level. Typical characteristics: Work overload, Environmental distractions, Unclear performance objectives or feedback, Lack of relevant knowledge, or skill, Poor communication, Low morale. 3. Defined Level. Although there are performing basic workforce practices, there is inconsistency in how these practices are performed across units and little synergy across the organization. The organization misses opportunities to standardize workforce practices because the common knowledge and skills needed for conducting its business activities have not been identified. 4. Predictable Level. The organization manages and exploits the capability created by its framework of workforce competencies. The organization is now able to manage its capability and performance quantitatively. The organization is able to predict its capability for performing work because it can quantify the capability of its workforce and of the competency-based processes they use in performing their assignments. 5. Optimizing Level. The entire organization is focused on continual improvement. These improvements are made to the capability of individuals and workgroups, to the performance of competency-based processes, and to workforce practices and activities. The organization uses the established results of the quantitative management activities at Maturity Level 4, for improvements at Level 5. Maturity Level 5 organizations treat change management as an ordinary business process to be performed in an orderly way on a regular basis.

For continuously improving individual competencies. For developing effective teams. For motivating improved performance.

Clarifying and communicating vision and strategy into action. Explanation of Balanced Scorecard of Kaplan and Norton. ('92)
HISTORY OF THE BALANCED SCORECARD In 1992, an article by Robert Kaplan and David Norton entitled "The Balanced Scorecard - Measures that Drive Performance" in the Harvard Business Review caused a lot of attention for their method, and led to their business bestseller, "The Balanced Scorecard: Translating Strategy into Action", published in 1996. The financial performance of an organization is essential for its success. Even non-profit organizations must deal in a sensible way with funds they receive. However, a pure financial approach for managing organizations suffers from two drawbacks:

It is historical. Whilst it tells us what has happened to the organization, it may not tell us what is currently happening. Nor it is a good indicator of future performance.

It is too low. It is common for the current market value of an organization to exceed the market value of its assets. Tobin's-q measures the ratio of the value of a company's assets to its market value. The excess value is resulting from intangible assets. This kind of value is not measured by normal financial reporting. THE 4 PERSPECTIVES OF THE BALANCED SCORECARD The Balanced Scorecard method of Kaplan and Norton is a strategic approach, and performance management system, that enables organizations to translate a company's vision and strategy into implementation, working from 4 perspectives: 1. Financial perspective. 2. Customer perspective. 3. Business process perspective. 4. Learning and growth perspective. This allows the monitoring of present performance, but the method also tries to capture information about how well the organization is positioned to perform in the future. BENEFITS OF THE BALANCED SCORECARD Kaplan and Norton cite the following benefits of the usage of the Balanced Scorecard:

Focusing the whole organization on the few key things needed to create breakthrough performance. Helps to integrate various corporate programs. Such as: quality, re-engineering, and customer service
initiatives.

Breaking down strategic measures towards lower levels, so that unit managers, operators, and employees
can see what's required at their level to achieve excellent overall performance. 1. THE FINANCIAL PERSPECTIVE Kaplan and Norton do not disregard the traditional need for financial data. Timely and accurate funding data will always be a priority, and managers will make sure to provide it. In fact, there is often more than sufficient handling and processing of financial data. With the implementation of a corporate database, it is hoped that more of the processing can be centralized and automated. But the point is that the current emphasis on financial issues leads to an unbalanced situation with regard to other perspectives. There is perhaps a need to include additional financial related data, such as risk assessment and cost-benefit data, in this category.

2. THE CUSTOMER PERSPECTIVE Recent management philosophy has shown an increasing realization of the importance of customer focus and customer satisfaction in any company. These are called leading indicators: if customers are not satisfied, they will eventually find other suppliers that will meet their needs. Poor performance from this perspective is thus a leading indicator of future decline. Even though the current financial picture may seem (still) good. In developing metrics for satisfaction, customers should be analyzed. In terms of kinds of customers, and of the kinds of processes for which we are providing a product or service to those customer groups.

3. THE BUSINESS PROCESS PERSPECTIVE This perspective refers to internal business processes. Measurements based on this perspective will show the managers how well their business is running, and whether its products and services conform to customer requirements. These metrics have to be carefully designed by those that know these processes most intimately. In addition to the strategic management processes, two kinds of business processes may be identified: Support processes. The support processes are more repetitive in nature, and hence easier to measure and to benchmark. Generic measurement methods can be used. 4. LEARNING AND GROWTH PERSPECTIVE This perspective includes employee training and corporate cultural attitudes related to both individual and corporate self-improvement. In a knowledge worker organization, people are the main resource. In the current climate of rapid technological change, it is becoming necessary for knowledge workers to learn continuously. Government agencies often find themselves unable to hire new technical workers and at the same time is showing a decline in training of existing employees. Kaplan and Norton emphasize that 'learning' is something more than 'training'; it also includes things like mentors and tutors within the organization, as well as that ease of

Mission-oriented processes. Many unique problems are encountered in these processes.

communication among workers that allows them to readily get help on a problem when it is needed. It also includes technological tools such as an Intranet. The integration of these four perspectives into a one graphical appealing picture, has made the Balanced Scorecard method very successful as a management methodology. OBJECTIVES, MEASURES, TARGETS, AND INITIATIVES For each perspective of the Balanced Scorecard four things are monitored (scored): Measures: the observable parameters that will be used to measure progress toward reaching the objective. For example, the objective of profitable growth might be measured by growth in net margin.

Objectives: major objectives to be achieved, for example, profitable growth.

Targets: the specific target values for the measures, for example, 7% annual decline in manufacturing disruptions.

Initiatives: projects or programs to be initiated in order to meet the objective. DOUBLE-LOOP FEEDBACK In traditional industrial activity, "quality control" and "zero defects" were important words. To shield the customer from receiving poor quality products, aggressive efforts were focused on inspection and testing at the end of the production line. A problem with these approaches - as pointed out by Deming - is that the true causes of defects could never be identified, and there would always be inefficiencies because products with a defect are rejected. Deming understood that variation is created at every step in a production process, and the causes of variation need to be identified and repaired. If this can be done, then there is a way to reduce the defects and improve product quality indefinitely. To establish such a process, Deming emphasized that all business processes should be part of a system, with feedback loops. The feedback data should be examined by managers to determine the causes of variation, and what are the processes with significant problems. Then they can focus their attention on repairing that subset of processes.
The balanced scorecard method includes feedbacks around internal business process outputs. As in TQM. Additionally, the Balanced Scorecard provides a feedback for the outcomes of business strategies. This creates a "double-loop feedback" process in the balanced scorecard. OUTCOME METRICS You can't improve what you can't measure. Therefore metrics must be developed based on the priorities of the strategic plan, which provides the key business drivers and criteria for metrics managers most desire to watch. Processes are then designed to collect information relevant to these metrics and reduce it to numerical form for storage, display, and analysis. Decision makers examine the outcomes of various measured processes and strategies and track the results to guide the company and provide feedback. So the value of metrics is in their ability to provide a factual basis for defining:

Strategic feedback to show the present status of the organization from many perspectives for decision makers.
Diagnostic feedback into various processes to guide improvements on a continuous basis. Trends in performance over time.

Feedback around the measurement methods themselves. Which measurements should be tracked?

Quantitative inputs for forecast methods and for decision support systems. MANAGEMENT BY FACT The goal of measuring is to permit managers to see their company more clearly - from many perspectives - and hence to make wiser long-term decisions. A 1997 booklet on the Baldrige Criteria summarizes this concept of fact-based management:
"Modern businesses depend upon measurement and analysis of performance. Measurements must derive from the company's strategy and provide critical data and information about key processes, outputs and results. Data and information needed for performance measurement and improvement are of many types, including: customer,

product and service performance, operations, market, competitive comparisons, supplier, employee-related, and cost and financial. Analysis entails using data to determine trends, projections, and cause and effect - that might not be evident without analysis. Data and analysis support a variety of company purposes, such as planning, reviewing company performance, improving operations, and comparing company performance with competitors' or with 'best practices' benchmarks." "A major consideration in performance improvement involves the creation and use of performance measures or indicators. Performance measures or indicators are measurable characteristics of products, services, processes, and operations the company uses to track and improve performance. The measures or indicators should be selected to best represent the factors that lead to improved customer, operational, and financial performance. A comprehensive set of measures or indicators tied to customer and/or company performance requirements represents a clear basis for aligning all activities with the company's goals. Through the analysis of data from the tracking processes, the measures or indicators themselves may be evaluated and changed to better support such goals." CAUTIONARY NOTE ON USING THE BALANCED SCORECARD You tend to get what you measure. People will work to achieve the explicit targets which are set. For example, emphasizing traditional financial measures may encourage short-term thinking. The Core Group Theory by Kleiner provides further clues on the mechanisms behind this. Kaplan and Norton recognize this, and urge for a more balanced set of measurements. But still, people will work to achieve their scorecard goals, and may ignore important things which have no place on their scorecard. EVOLUTION OF THE BALANCED SCORECARD In 2002, Cobbold and Lawrie developed a classification of Balanced Scorecard designs based upon the intended method of use within an organization. They describe how the Balanced Scorecard can be used to support three distinct management activities, the first two being management control and strategic control. They assert that due to differences in the performance data requirements of these applications, planned use should influence the type of BSC design adopted. Later that year the same authors reviewed the evolution of the Balanced Scorecard as shown through the use of Strategy Maps as a strategic management tool, recognizing three distinct generations of Balanced Scorecard design.

Quality Function Deployment

of Akao and Mizuno. ('65)
WHAT IS QUALITY FUNCTION DEPLOYMENT? DESCRIPTION The Quality Function Deployment (QFD) philosophy was pioneered by Yoji Akao and Shigeru Mizuno. It aims to design products that assure customer satisfaction and value - the first time, every time. The QFD framework can be used for translating actual customer statements and needs ("The voice of the customer") into actions and designs to build and deliver a quality product . Typical tools and techniques used within QFD include: Relations Diagrams. To discover priorities and root causes of process problems and unspoken customer requirements.

Affinity Diagrams. To surface the "deep structure" of voiced customer requirements.

Hierarchy Trees. To check for missing data and other purposes. Various Matrixes. For documenting relationships, prioritization and responsibility.

Process Decision Program Diagrams. To analyze potential failures of new processes and services.

Analytic Hierarchy Process. To prioritize a set of requirements, and to select from alternatives to meet those requirements. Blueprinting. To depict and analyze all the processes which are involved in providing a product or service. House of Quality. THE HOUSE OF QUALITY The House of Quality is a popular collection of several deployment hierarchies and tables, including the Demanded Quality Hierarchy, Quality Characteristics Hierarchy, the Relationships Matrix, the Quality Planning Table, and the Design Planning Table. It has the form of a table, that connects dots between the Voice of the Customer and the Voice of the Engineer. The House of Quality is used by multidisciplinary teams to translate a set of customer requirements, using market research and benchmarking data, into an appropriate number of prioritized engineering targets to be met by a new product design.
The House of Quality is a sort of conceptual map, which provides means to the interfunctional planning and coordination of product improvement and product development. In a way this method brings the customer needs in the focus to design or to redesign the product and service. In this method the starting point would be the customer needs which are found from any market research survey about the product in question. Primary, secondary and tertiary customer attributes are found. These form the base of the house. Corresponding engineering characteristics are specified which should be in clear measurable terms. Now the interdependencies are mapped which are in the form of the roof of the house. Accordingly, technical difficulties in achieving the desired changes are calculated. With the help of imputed importance of each characteristic the cost is worked out. Then final targets are set in clear measurable terms. In essence with the help of customer needs, the product is redesigned in clear unequivocal measurable terms. The House of Quality contains six major components: 1. Customer requirements (HOW`s). A structured list of requirements derived from customer statements. 2. Technical requirements (WHAT`s). A structured set of relevant and measurable product characteristics. 3. Planning matrix. Illustrates customer perceptions observed in market surveys. Includes relative importance of customer requirements, company and competitor performance in meeting these requirements. 4. Interrelationship matrix. Illustrates the QFD team's perceptions of interrelationships between technical and customer requirements. An appropriate scale is applied, which is illustrated by using symbols or figures. To fill this portion of the matrix involves discussions and to build consensus within

the team, which can be time consuming. Concentrating on key relationships and minimizing the numbers of requirements are useful techniques to reduce the demands on resources. 5. Technical correlation (Roof) matrix. Used to identify where technical requirements support or impede each other in the product design. Can highlight innovation opportunities. 6. Technical priorities, benchmarks and targets. Used to record: o The priorities assigned to technical requirements by the matrix. o Measures of technical performance achieved by competitive products. o The degree of difficulty involved in developing each requirement. The final output of the matrix is a set of target values for each technical requirement to be met by the new design, which are linked back to the demands of the customer. ORIGIN OF QUALITY FUNCTION DEPLOYMENT. HISTORY QFD was first developed in Japan in the late 1960s by Professor Yoji Akao and Professor Shigeru Mizuno as a quality system. QFD was aimed at delivering products and services that efficiently satisfy customers. One should listen to the "voice of the customer" throughout the product or service development process. Mizuno, Akao and other Japanese Quality Management experts developed the tools and techniques for QFD and organized them into a comprehensive system to assure quality and customer satisfaction in new products and services. After World War II, statistical quality control had taken roots in the Japanese manufacturing industry. Quality activities were being integrated with techniques that were emphasizing the importance of making quality control a part of business management. This became eventually known as TQC and TQM. Mizuno and Akao wanted to develop a quality assurance method that would design customer satisfaction into a product before it was manufactured. Prior quality control methods were primarily aimed at fixing a problem during or after manufacturing. Yoji Ako was the first pioneer to develop QFD from 1965 to 1967 at Matsushita Electric in Japan. In 1966, Kiyotaka Oshiumi of Bridgestone Tires in Japan presented a first large scale application, which used a process assurance items fishbone diagram to identify each customer requirement (effect), and to identify the design substitute quality characteristics and process factors (causes), which are needed to control and measure it. In 1972, with the application of QFD to the design of an oil tanker at the Kobe Shipyards of Mitsubishi Heavy Industry, the fishbone diagrams grew unwieldy. Since the effects shared multiple causes, the fishbones could be changed into a spreadsheet or matrix format. The rows were desired effects of customer satisfaction, and the columns were the controlling and measurable causes. At the same time, Katsuyoshi Ishihara introduced the Value Engineering principles, which are used to describe how a product and its components work. He expanded this to describe business functions necessary to assure quality of the design process itself. Merged with these new ideas, QFD eventually became the comprehensive quality design system for both product and business process. The introduction of QFD to America and Europe began in 1983 when the American Society for Quality Control published Akao's work in Quality Progress. Following that, Cambridge Research (now the Kaizen Institute) invites Mr. Akao to give a QFD seminar in Chicago. USAGE OF THE QUALITY FUNCTION DEPLOYMENT METHOD. APPLICATIONS

To prioritize customer demands and customer needs. Spoken and unspoken;

Translating these needs into actions and designs such as technical characteristics and specifications; and To build and deliver a quality product or service, by focusing various business functions toward achieving a common goal of customer satisfaction. QFD has been applied in any industry: aerospace, manufacturing, software, communication, IT, chemical and pharmaceutical, transportation, defense, government, R&D, food, and service industry. STEPS IN QUALITY FUNCTION DEPLOYMENT. PROCESS Typically, a QFD process has the following stages: 1. Derive top level product requirements or technical characteristics from customer needs, using the Product Planning Matrix. 2. Develop product concepts to satisfy these requirements.

3. Evaluate product concepts to select the most optimal concept, using the Concept Selection Matrix. 4. Partition the system concept or architecture into subsystems or assemblies, and transfer the higher level requirements or technical characteristics to these subsystems or assemblies. 5. Derive lower-level product requirements (assembly or part characteristics) and specifications from subsystem/assembly requirements (Assembly/Part Deployment Matrix). 6. For critical assemblies or parts, derive lower-level product requirements (assembly or part characteristics) into the process planning. 7. Determine manufacturing process steps that correspond to these assembly or part characteristics. 8. Based on these process steps, determine set-up requirements, process controls and quality controls to assure the achievement of these critical assembly or part characteristics. STRENGTHS OF THE QUALITY FUNCTION DEPLOYMENT MODEL. BENEFITS

QFD seeks out both "spoken" and "unspoken" customer requirements and maximizes "positive" quality (such as ease of use, fun, luxury) that creates value. Traditional quality systems aim at minimizing negative quality (such as defects, poor service).

Instead of conventional design processes that focus more on engineering capabilities and less on customer needs, QFD focuses all product development activities on customer needs.
QFD makes invisible requirements and strategic advantages visible. This allows a company to prioritize and deliver on them.

Reduced time to market. Reduction in design changes. Decreased design and manufacturing costs. Improved quality. Increased customer satisfaction.

The literature describes how Toyota reduced start-up losses by 61%. Mazda reduced last minute design changes by half, etc. LIMITATIONS OF QUALITY FUNCTION DEPLOYMENT. DISADVANTAGES

As with other Japanese management techniques, some problems can occur when we apply QFD within the western business environment and culture.
Customer perceptions are found by market survey. If the survey is performed in a poor way, then the whole analysis may result in doing harm to the firm. The needs and wants of customers can change quickly nowadays. Comprehensive systemand methodical thinking can make adapting to changed market needs more complex. ASSUMPTIONS OF QUALITY FUNCTION DEPLOYMENT. CONDITIONS Customer needs can be documented and captured and they remain stable during the whole process.

The market survey results are accurate.

Continuous quality improvement. Explanation of Deming Cycle. PDSA.

SHORT BIOGRAPHY OF W. EDWARDS DEMING W. Edwards Deming was an American statistician. He is associated with the rise of Japan as a manufacturing nation, and with the invention of Total Quality Management (TQM). Along with an other American quality guru J.M. Juran, Deming went to Japan as part of the allied occupation forces after World War II. Deming taught a lot of Quality Improvement methods to the Japanese, including the usage of statistics and the PDSA cycle. In 1960 he was awarded a medal by the Japanese Emperor for his services to that country's industry. THE DEMING CYCLE (PDSA CYCLE) (PDCA CYCLE) The Deming Cycle, or PDSA cycle, is a model for continuous improvement of quality. It consists of a logical sequence of four repetitive steps for continuous improvement and learning: PLAN, DO, STUDY (CHECK) and ACT. The PDCA cycle is also known as the Deming Cycle, or as the Deming Wheel or as the Continuous Improvement Spiral. It originated in the 1920s with the eminent statistics expert Mr. Walter A. Shewhart, who introduced the concept of Plan, Do and See. Deming modified the cycle of Shewart towards: PLAN, DO, STUDY and ACT. The Deming Cycle is related to Kaizen thinking and Just-in-time manufacturing. BENEFITS OF THE DEMING CYCLE

Daily routine management-for the individual and/or the team, The problem solving process, Project management, Continuous development, Vendor development, Human resources development, New product development, and Process trials.

THE 4 PARTS OF THE DEMING CYCLE EXPLAINED

PLAN. Plan ahead for change. Analyze and predict the results. DO it. Execute the plan, taking small steps in controlled circumstances. STUDY (check). Study the results. ACT. Take action to standardize or improve the process.

THE DEMING MANAGEMENT METHOD EXPLAINED BY MARY WATSON In her book "The Deming Management Method" Mary Watson tells about the life of the business guru Edwards Deming. The industrial miracle in Japan was a prime example of what can happen when a nation commits itself to quality and long-range vision instead of the latest illness: "Turning a Fast Buck-itis." In less then 50 years, Japan went from making cheap and low added value products, towards manufacturing of the highest quality precision work in the world. When Dr. Deming first began speaking in America, America was still riding along on the post-war victory wave. No one would listen to him. The Japanese welcomed him, and even today, traces of his quality-control methods are still seen in the industrial workplace.

Gradual, continuous (incremental) change (improvement). Explanation of Kaizen.

WHAT IS KAIZEN? DEFINITION The Kaizen method of continuous incremental improvements is an originally Japanese management concept for gradual, continuous (incremental) change (improvement). Kaizen is actually a way of life philosophy. It assumes that every aspect of our life deserves to be constantly improved. The Kaizen philosophy lies behind many Japanese management concepts such as: Total Quality Control, Quality Control circles, small group activities, labor relations. Key elements of Kaizen are: quality, effort, involvement of all employees, willingness to change, and communication. Japanese companies distinguish between: Innovation, a radical form of change, and Kaizen, a continuous form of change. Kaizen means literally: change (kai) to become good (zen). THE FIVE FOUNDATION ELEMENTS OF KAIZEN 1. Teamwork. 2. Personal discipline. 3. Improved morale. 4. Quality circles. 5. Suggestions for improvement. OUT OF THIS FOUNDATION, THREE KEY FACTORS IN KAIZEN ARISE

1. 2. 3. 4. 5.

Elimination of waste (muda) and inefficiency. The Kaizen five-S framework for good housekeeping.

Seiri - tidiness Seiton - orderliness Seiso - cleanliness Seiketsu - standardized clean-up Shitsuke - discipline

Standardization. When should the Kaizen philosophy be applied? Although it is difficult to give generic advice it is clear that it fits well in gradual, incremental change situations that require long-term change and in collective cultures. More individual cultures that are more focused on short-term success are often more conducive to concepts such as Business Process Reengineering. KAIZEN COMPARED TO BUSINESS PROCESS REENGINEERING When Kaizen is compared with the BPR method it is clear the Kaizen philosophy is more people-oriented, more easy to implement, but requires long-term discipline and provides only a small pace of change. The Business Process Reengineering approach on the other hand is harder, technology-oriented, it enables radical change but it requires considerable change management skills.