The History and Future of Quality – a Personal Journey , Jim Harrington

Dr. H. James HarringtonCEO

Harrington Institute Inc.

Confusion Reigns Supreme• Philip B. Crosby’s 14 Steps• Dr.W. Edwards Deming’s 14 Points, or new

and different 14 Points of “Profound Knowledge”

• Dr. Armand V. Feigenbaum’s 10 Benchmarks for Quality Success

• Dr. Joseph M. Juran’s Step-By-Steps Improvement

• Dr. Kaoru Ishikawa’s Six Categories for Transformation

Carl Frederick Gauss1777 - 1855

• Roots of Six Sigma as a measurement standard can be traced back to him

• Introduced the concept of the normal curve

Frederick W. TaylorThe Father of Industrial Engineering and

Scientific Management(1865 -1915)

Frederick Taylor’s Planning Responsibilities

1. Develop scientific methods for doing work2. Establish goals for productivity3. Establish systems and rewards for meeting the

goals4. Train the personnel in how to use the methods

and thereby, meet the goals5. Intimate and friendly cooperation between

management and the men Source: F. W. Taylor, Scientific Management

Suggestion Plans (1896)

National Cash Register Company• Employee Involvement• Recognition

Quality 1900 to 1915

Henry FordFather of Mass Production

1863-1947

Profit Sharing (five-dollar day)

He believed that hard work was its own reward and that all a

man needs in life is a worthwhile job at a fair rate of pay and a home in which

to spend time with his family.

Ford Was the Best in JIT

Four days from iron ore to completed car being shipped to the customer

Henry Ford, Sr.Today and Tomorrow

Frank GilbrethFather of Lean

1868 - 1924

Taylor was a stopwatch man and Gilbreth was a process method man– One best way of doing things– Elimination of waste– Flow charting

Quality 1915 to 1940

Walter A. ShewhartFather of Statistical Quality Control

(1891 – 1967)

“Dr. Shewhart prepared a little memorandum only about a page in length (May 1924). About a third of that page was given over to a simple diagram

which we would all recognize today as a schematic control chart.”

Plan-Do-Check-Act(Shewhart)

Plan1. Identification of targets (objectives and goals)2. Identification of methods/procedures to achieve these targets3. Identify control items and methods

Do4. Communicate and train associates5. Implement the plan (2 and 3)

Check6. Check progress to plan (1,2,3)

– Against targets and goals– Within the strategy

7. Identify any problems

Act8. resolve/eliminate problems9. Correct/modify plan (2 and 3)10. Standardize the improvement

1935-H.J.H. Interdiction to Quality

• 1935 to 1940 my Father ran control charts on my grades ( age 6 to 11 )

• .If the average was less than 85%, I was not allowed to listen to the radio for the next month and I lost my $.05 allowance a week.

• Between 85-88%, I was allowed 10 hours of radio per week and got my allowance back.

• Between 88 – 92%, I also got money to go to the movies Saturday.

• Over 92%, he would throw in a bag of popcorn and I could listen to the radio as often as I liked.

Quality 1940 to 1980

1946 – The American Society For Quality Control Formed

1946- Union of Japanese Scientists and Engineers(JUSE)

1957- European Organization for Quality Formed

Joseph M. Juranthe father of

Continuous Improvement(1904-2008 )

W. Edwards DemingBest known for the "Plan-Do-Check-Act"

cycle popularly• Deming made a significant contribution to

Japan's later reputation for innovative high-quality products and its economic power

Dr. Armand V. FeigenbaumThe Father of Total Quality Control

TQC book 1951(1922- )

Applied quality principles to the total production process (Womb to Tomb)

Dr. Kaoru IshikawaThe Father of Quality Circles

(1915 – 1989)

“The results of company-wide activities are remarkable, not only in ensuring the quality of industrial products, but also in their contribution to the company’s overall business.”

Company-wide quality based upon the concepts of Val Feigenbaum

Walter MasingOutstanding Leader of the Quality

Movement in Europe( 1915 -2004)

• Cofounder of the German Society for Quality-1972, European organization for quality-1956, and the International Association for Quality

1952-Continuous Flow at IBM• 047-Collator production line• Endicott New York building five second

floor• Subassembly to final assembly the final test

the covers and ship• Every machine was manufactured for

specific customer• No quality inspectors – management

assured quality

Philip B. CrosbyFather of Zero Defects

October, 19611926 - 2001

Sets the target for quality

1963-Established an IBM Quality Research center

• Applied military quality approaches to commercial resulted in major improvements in reliability

• End of line reliability and stress test facility to predict reliability

• Connected field reporting to in-line process reporting• Established statistical process controls and reporting• Prepared standard quality operating manual• Established operator certification program• Etc.

1964-IBM-Poor Quality Cost

• Direct Poor – Quality Costs

• Controllable Costs• Preventive Cost• Appraisal Cost• Result Costs• Internal Error Costs• External Error Cost• Indirect Poor – Quality Cost• Customer Incurred Cost• Customer – Dissatisfaction Costs• Loss of Reputation Cost•

1967-IBM-Start of Business Process Improvement

• 1967 White-collar Poor Quality Cost• Flowcharting support areas processes• Reducing cost of scrap, rework and Bureaucracy

in all support areas• 1983- Rename A corporate wide initiative

called Business Process Improvement –• Focuses on reducing costs and reducing cycle time

and improving quality

IBM’s Major Quality Error

• 1972-Quality Integration• Inspectors transferred to manufacturing• Quality engineers transferred to product

engineering and manufacturing engineering• Receiving inspection transferred to purchasing• Quality Assurance reduced to off-line reliability

testing and a small audit Department

1978-1983 IBM Reestablishing Quality Leadership

• Reestablishing the quality function• Process qualification• Process compatibility worldwide• Established a quality training center with mandatory

requirements for all managers• Established a corporate vice president for quality• Cross division audits of quality systems• Field merge up machines• Area Activity Analysis• Reestablished quality cost reporting systems• Focus on supplier process controls and total performance• Quality error reporting back to the individual

Toyota’s Production System• JIT• Lean• Empowerment• Suggestions• Teams• Supplier Involvement

SIMPLIFY, SIMPLIFY, SIMPLIFY

Shigeo ShingoLean

1919 -1990

Refined industrial engineering as a strategic activity, rather than a technical discipline at Toyota.

“Japanese keep things simple, while Americans make things complicated. That explains why Japanese have thick black

hair, while Americans have thinning gray hair.”Shigeo Shingo

Source: Waddell and BodekRebirth of American Industry

Dr. Genichi Taguchi(1924- )

• Uncontrolled sources of variation noise factors

• Loss Function• Orthogonal arrays and linear graphs• Robustness

Dr. A. C. RosanderThe Father of Service Quality

1970

• Hotels, banks, software and government• White-collar worker’s quality• Administrative Applications Division

Quality 1980 to 1990

John A. YoungHP’s Performance Goals for the 1980’s

“I called for ‘stretch’ objectives, I asked that our product failure rates be cut to

one-tenth their current levels by the end of the decade of the 80s.”

J. YoungCEO of HP

Total Quality Management-1983

TQC plus: Lean Teams Top management involvement Total organization (Support Departments included) Customer focus Suppliers controls Employee Improvement Strategy Planning Rewords and Recognition Systems Error free performance standard

Business Process Redesign1983

• Major process• Simulation modeling• Value-added analysis• 10 BPI tools• Streamlining

Area Activity Analysis1984

• Natural work teams• Major processes (10% of resources)• Flow charting• Documented sign-off requirements• Focused continuous improvement

Statistical Software1985

Everyone can be a statistician.

1987-ISO 9000

• An international standard designed to set the minimum requirements for a quality management system.

• It has since gone through many revisions.• 1987 version• 1994 version• 2000 version• 2008 version

• Many specific industry focused quality management system standards that been released since that date

1987 Malcolm Baldrige quality Award

• The Baldrige Program oversees the nation's only Presidential award for performance excellence while offering criteria, assessments, tools, training and a community for those dedicated to helping organizations improve

Quality at Motorola

Weise (COO) Sets a Second Cycle of “Ten Times Improvement in Four Years”

1987

How do you measure ten-times improvement?.

ANSWER:Measure defects per unit.

3 defects per 100 to 3 defects per 1000 is 10 times improvement.

Birth of Six Sigma1987

• Focus on variation• Statistical quality tools• Black Belts• Green Belts• 3.4 defects per million measurement standard• RDMAICSIRecognize/Define/Measure/Analyze/Improve/Control/Standardize/Integrate

(DMAIC GE’s approach )

Training at Motorola

• 1987 – spent $44 million on training (2.4% of the corporation’s payroll)

• 40% on quality training

Six Sigma Objectives

Phase AOut of Control

Phase BStable

Phase CNever ending Improvement

Process Redesign Objective

Time

Cos

t

Long Range Quality Plan1988 HP

• Define key business drivers• Define how they should change• Select tools• Develop a three-year improvement plan• Update yearly

Quality1990 to 2000

Dr. Robert Kaplan& Dr. David Norton

Fathers of Balanced Scorecard1991

• Internal and external measurements• Financial measurements are inadequate• Long and short term• 4 perspectives:

– Learning and growth– Business process– Customer– Financial

Organizational Change Management1991

• Focus on the human ability to change• Breakdown resistance• Build resiliency• Pain management

Business Process Reengineering1993

Reengineering the corporation– Michael Hammer– James Champy– CRM– E-business

Six Sigma at GE1994 - 2003

Pushed by Jack Welch• 1995 – 200 projects• 1997 – 6000 projects• 1997 – savings of $320 million or $53,333/project

How Do You Measure theQuality of an Organization?

• Customer satisfaction• Mean-time to failure• First time yields• Poor-Quality Cost• Suggestions/employee• Cost of warranty• Percent returned items• Dollars saved• First 90 days failure rates

Quality2000 - 2013

• Lean Six Sigma• Design for Six Sigma• Enterprise-wide Six Sigma• Total Six Sigma

ORGANIZATIONAL ALIGNMENT

Strategy

RewardSystem

Processes &Capabilities

PeoplePractices Structure

FUTURE OF QUALITY

F= FastU= UnstructuredT= TurbulentU= Universal R= RevolutionaryE= Ethics

Future=Faster• Less time to solve problems• Less time to bring a new product• Less time to understand customers

requirements• Shorter product life cycles• Rapid changes in technology• Rapid international highlighting of

problems• Increased risk-taking

FUture=Unstructured

• Increase subcontracting • Increase use of innovators• Integration of quality activities• Reduce importance of standards• Increased turbulence• Increased use of specialized product

FuTure=Turbulent

• Increase multi-culture environment• Increase turnover• Fewer permanent jobs• Uncensored data exchange providing

misleading information• Increased tension in the Middle East• Rapid changes in technology

FutUre=Universal

• Worldwide customer base.• Worldwide competitive organizations.• Worldwide supplier base.• Worldwide manufacturing• . Market segregation drives different

requirements

FutuRe=Revolutionary

• Shipping new products before they are totally evaluated

• New approach to quality of projects/initiatives• Supplier quality data systems available to

customer• Control out-- risk in• Short product cycles• Project quality rather than measured quality• Measurement of executive error rate

FuturE=Ethics

• Very degree of ethics in different parts of the world

• Legal action for unethical behaviors• Strict enforcement of infringements

Changing Global MarketsBell

Mass ProductionLow CostGood Enough QualityLow Emotional

SpecializedHigh Personnel ValueHigh Cost and QualityHigh Emotional

1980’s

Changing Global MarketsBell

Well

Mass ProductionLow CostGood Enough QualityLow Emotional

SpecializedHigh Personnel ValueHigh Cost and QualityHigh Emotional

1980’s

2010’s

Your Organization's Reputation

• Perception not reality• Products not service industry• Innovations not sustain performance• Technology driven not process driven

Your Organizations Reputation –cont.

• Increase focus on knowledge management• Increase focus on change management• Increased involvement in marketing and

sales• Focus of the lifecycle quality cost and cost

of ownership• Increase focus on construction quality• Increase focus on governmental quality

Quality Organizations Future

• Design controls versus manufacturing process controls

• Return to quality focus versus cost reduction• Less standards driven• Supply chain focus• Reliability focus versus initial delivered

quality• Technology controls versus people controls

Changes to Quality As We Know It- 1of 3

• Quality measured in the lifecycle costs including customer costs

• Quality organizations redirect activities to marketing, sales, and product engineering.

• Increased emphasis on individual performance indicators(IPI)

• Suppliers measured on the quality level of their systems rather than on deliveries on time, cost, and initial quality.

Changes to Quality As We Know It- 2of 3

• Increase use of the customer as a final test station

• Increase focus on integrating quality assurance and other functions

• Increase focus on knowledge management systems and simulation modeling to prevent problems

• The realization that best practices are not the best practice for all

Changes to Quality As We Know It- 3 of 3

• Improvement projects like six Sigma and TQM measured based upon impact to the bottom line not individual project savings

• Decreased focus on uses standards• Increased focus on quality of the Board of

Directors• Far less focus on quality initiatives given

way to customize improvement directed at key business drivers

Have a quality day with a high degree of reliability.