total quality leadership: a primer12 total quality leadership: a primer total quality leadership: a...

Total Quality

Leadership:

A Primer

Archester Houston, Ph.D.Steven L. Dockstader, Ph.D.

Department of the NavyTotal Quality Leadership Office

About the TQLOThe mission of the Department of the Navy (DON) Total QualityLeadership Office (TQLO), is to assist the DON leaders in theirquality-focused improvement efforts. The TQLO also provides techni-cal advice to organizations inside and outside government. The TQLOhas responsibilities in six key areas:

Information and CommunicationThe TQLO educates the DON about TQL policies and initiativesthrough the TQLeader and through articles and presentations atconferences. It has developed an electronic bulletin board and anInternet site to facilitate communication.

AssessmentSystems are needed to assess and enhance TQL implementationin the DON. The TQLO designs and develops feedback mecha-nisms in support of mission accomplishment. It also developsnew approaches to improving organizational effectiveness.

Consultant ServicesTQLO members provide technical advice to the Under Secretaryof the Navy and other senior DON leaders on the application ofTQL principles and methods within the DON and on strategicplanning. Advice may also take the form of recommendations onimplementing new laws, such as the Government Performanceand Results Act, as well as on related initiatives.

Education and TrainingThe TQLO is responsible for ensuring the technical accuracy ofthe DON TQL curriculum. Having overseen the design anddevelopment of the courses, the staff now advises on the integra-tion of TQL material into training pipelines. The TQLO continuesto publish handbooks and other materials on organizationalchange and to design new courses.

Networking LiaisonThe TQLO has much to share with other organizations, govern-ment and private, and much to learn from them. Staff membersparticipates in TQL-related networks and organizations.

New TechnologiesTechnology can provide critical support to DON quality improve-ment efforts. The job of the TQLO is to assess new technologiesrelated to organizational change and process improvement andtranslate them into applications for the DON.

Total QualityLeadership:

A Primer

Archester Houston, Ph.D.Steven L. Dockstader, Ph.D.

Department of the NavyTotal Quality Leadership Office

TQLO Publication Number 97-02

5Total Quality Leadership: A Primer4 Total Quality Leadership: A Primer

The Department of the Navy (DON) began in1984 to improve organizational performancethrough the use of Total Quality Leadership(TQL) within its logistical organizations. Sincethat time, the practice of TQL has been de-ployed throughout the DON.

The change from past management practicesto TQL is substantial and impacts the jobs ofevery person in a naval organization. Becauseof this, the transition to TQL must be learned,planned for, and put into place in a systematicfashion. The implementation process must beled by the commanding officer (CO). A trainingprogram that provides all of the information toget started with TQL has been developed andis available to all naval organizations followingthe training of the CO.

Foreword


Introduction ...................................................................... 9

Purpose of the Primer .............................................. 10Background .............................................................. 10The Five Cornerstones of TQL ................................ 12Basic Concepts ........................................................ 14

Section 1: Definition of Total Quality Leadership ........... 17

“The application of quantitative methods . . .” .......... 18“. . . and the knowledge of people . . .”...................... 18“. . . to assess and improve . . .” ................................ 19“. . . all significant processes within theorganization . . .” ....................................................... 20“. . . now, and in the future.” ...................................... 21

This document is intended to provide anoverview of some of the major elements of theDepartment of the Navy approach to TQL. TheDON TQL Primer covers the definition of TQL,underlying philosophy, implementation roles,approach and management structure, and howthe scientific method is applied to improve workprocesses. While it is not a substitute for edu-cation and training, it will provide informationon the basics of the DON TQL approach andperhaps serve to dispel some misconceptions.

The authors of this Primer, Drs. ArchesterHouston and Steven L. Dockstader, were twoof the first people involved in the developmentand application of the DON TQL approachwhile they worked at the Navy Personnel Re-search and Development Center, San Diego,CA. This Primer draws upon their extensiveknowledge and experience in its application.

Our intention was to produce a useful docu-ment. Please direct any questions you haveabout it to Dr. Houston, DON TQL Office: Voice:703-602-8944 [DSN 332-], FAX: 703-602-8942,INTERNET: [email protected].

Linda M. Doherty, Ph.D.Director, Total Quality Leadership Office

Department of the Navy


Section 2: Adoption of the Deming Philosophy ............. 23

The Economic Rationale for the Practice of TQL .... 24The Three Components of the Deming Philosophy .. 27Viewing and Managing Organizations as Systems . 29The Role of Leaders ................................................. 32

Section 3: DON Implementation Approach ................... 35

Process Management .............................................. 37Strategic Management ............................................. 39Strategic Measurement ............................................ 43Strategic Management and PDCA ........................... 44Organizational Implications of StrategicManagement ............................................................ 44

Section 4: TQL Roles and Management Structure ....... 47

Process Management and the Structure of Teams . 48TQL Team Structure and the Chain of Command ... 52

Section 5: Application of the Scientific Method ............. 55

Use of the PDCA Cycle ............................................ 56TQL Adaptations of the PDCA Cycle ....................... 56

Summary ....................................................................... 61

Bibliography ................................................................... 63

Deming’s 14 Obligations of Leadership ......................... 70

Introduction

Total Quality Leadership, or TQL, provides themeans for Department of the Navy (DON)organizations to more efficiently and effectivelyrespond to current and future mission require-ments. These requirements appear in suchdocuments as the DON’s Forward from theSea, the Navy Policy Book, and theCommandant’s Planning Guidance. Thesedocuments describe the need to meet new andenhanced mission requirements with fewerresources, a compelling reason for the DON tofundamentally change its organizations, itspeople, and its leadership practices.


Purpose of the Primer

The purposes are twofold: (1) to document thebasic concepts and principles for the practiceof Total Quality Leadership (TQL), and (2) toprovide this information in a concise and read-able form to those who may not have had anytraining on the subject.

This primer is not a substitute for the educationand training necessary to effectively practiceTQL. It provides an overview of the basicconcepts and summarizes some organizationalimplications of implementation. It also attemptsto dispel misconceptions about TQL.

Background

In the Spring of 1984, the Naval Matériel Com-mand tasked the Navy Personnel Researchand Development Center (NPRDC) to investi-gate the feasibility of using statistical processcontrol (SPC) and quality management meth-ods to improve mission performance (Houston,Sheposh, & Shettel-Neuber, 1986). The re-search involved (1) literature reviews and sitevisits to private and public organizations apply-ing SPC; (2) identifying differences in qualitymanagement approaches of Crosby, Deming,and Juran, and the relationship of these ap-proaches to SPC methods (Suarez, 1992);(3) determining the suitability of commerciallyavailable quality management and SPC

training programs for naval use, and, finally,(4) identifying conditions needed in navalorganizations for effective use of quality man-agement and SPC (Dockstader, 1984).

Major conclusions of the research were that:

The integrated application of quality man-agement and SPC was feasible in navalorganizations.

Active participation of top leaders was acritical element for success.

Organizational changes must be made toestablish and sustain improvement throughthe application of quality management andSPC.

Based on the findings, the Naval Air SystemsCommand (NAVAIR) leaders decided to test aquality management approach based on thephilosophy of W. Edwards Deming, a prominentquality consultant who contributed to Japan’seconomic gains following WWII. The first testswere conducted at North Island Naval AviationDepot. As a result of success in quality im-provement there, the approach was extendedto other aviation depots, shipyards, and supplycenters. In 1985, the label “Total Quality Man-agement” (TQM) was coined in the DON todescribe this approach. In 1990, the Chief ofNaval Operations replaced the label “Total


Quality Management” with “Total Quality Lead-ership” (TQL) to emphasize the crucial roleleaders have in the quality approach. Thischange in labels did not change any of themajor elements of the approach. Total QualityLeadership is now used throughout the Depart-ment, including headquarters, logistical com-mands, operational units, field activities, andsystems commands.

For more detailed coverage on the origin of theDON TQL approach, the following readings arerecommended: Deming Management at Workby Mary Walton (1990) and Thinking aboutQuality by Lloyd Dobyns and Clare Crawford-Mason (1994).

The Five Cornerstones of TQL

TQL is an approach to quality managementthat is based upon five major elements orcornerstones. This section describes brieflythose cornerstones and presents informationabout some related concepts that are centralto TQL:

1Definition. TQL is defined as “the applica-tion of quantitative methods and the knowl-

edge of people to assess and improve (a)materials and services supplied to the organi-zation, (b) all significant processes within theorganization, and (c) meeting the needs of theend-user, now and in the future.”

This definition describes the “what” of TQL(“application of quantitative methods and theknowledge of people to assess and improve”),the “where” of the effort (“all significant pro-cesses [performed] within the organization”)and the “when” (“now, and in the future”).“Significant” is used to emphasize that TQLpractices should address processes central tomission performance, not those that are inci-dental to it. This emphasis avoids committingscarce organizational resources to less impor-tant issues.

2The Deming philosophy provides the basis for TQL. W. Edwards Deming (1900-

1993) was a physicist and statistician whodeveloped a management philosophy for im-proving quality. The principal elements of thephilosophy come from the (a) theory of varia-tion; (b) application of systems theory to man-aging organizations; (c) psychology of work,and (d) use of the scientific method to pursueoptimal mission performance. These elementswere adapted for implementation in navalorganizations.

3Department of the Navy implementationapproach. The approach to implementation

is two-phased (Doherty, 1990). The first phaseconcentrates on planning and conductingquality improvement efforts. Education andtraining resources for process improvement arerequired for success. The second phase ad-vances and sustains the continual improvement


throughout the organization, including suppli-ers. Strategic planning and management areused to enhance future mission performance.

4 Management structure. Changes in systems and processes are managed

through the chain of command. Significantmission-related processes typically crossfunctional areas. Therefore, cross-functionalteams at the executive, middle, and supervi-sory levels must be linked for communicationand coordination of efforts. These teams con-centrate on gathering and applying informationto improve mission effectiveness.

5A scientific approach. The aim of TQL is to enhance mission effectiveness. This is

achieved by using an objective, disciplinedapproach to making changes in the processesand systems that affect mission performance.The performance of current processes andsystems is analyzed and an improvement planis developed. The plan is carried out and per-formance is analyzed to determine the effectsof changes. Changes that result in improve-ment are retained.

Basic Concepts

In addition to the five cornerstones of TQL,other important concepts are:

Quality focus

For the naval service, quality refers to theextent to which naval organizations satisfy theirmission requirements. While mission require-ments can involve products, they are morefrequently associated with services. Some ofthese are delivery of supplies, medical care,engineering support, successful aircraftlaunchings, ordnance on target, etc.

Customers and end-users

The term “customers” refers to those peoplewho buy and/or use products and services. Inthe world of commerce they ultimately definequality. Under TQL, the focus of quality im-provement efforts is to meet mission require-ments as defined by the operational forces. TheSailors and Marines are the customers or,more appropriately, “end-users” of productsand services provided by the DON. Sailors andMarines are the ultimate judges of the qualityof the supplies, medical care, engineeringsupport, weapons systems, training, etc.

Improvement then must address all the signifi-cant processes that enable the Sailors andMarines to fight, win, and survive. While TQL isnot used to conduct operational missions inreal time, operating forces can use the sameprocedures to improve the processes thatcontribute to mission readiness (Doherty &Howard, 1994; Howard, 1992; Wasik & Ryan,1993).

Section


1

Process improvement

Process improvement involves systematicallyanalyzing and changing process factors so thatthey work together better to improve quality.Mission effectiveness is increased throughimprovement, redesign, or innovation of pro-cesses. Processes are improved when they aremore predictable, cost less, and contributemore to meeting mission requirements.Through process improvement problems orerrors are prevented rather than fixed after theyhave occurred.

Process management

Process management involves the leadershipactions required to begin and sustain continu-ous improvement of significant processes.

Extended process

An organization can and should work withcustomers and suppliers as part of an ex-tended system to improve quality. Customerscan provide information that helps an organiza-tion to focus its improvement efforts on thoseproduct and service characteristics that havethe greatest impact on quality. Suppliers pro-vide products or services that affect anorganization’s ability to perform its mission.Working with suppliers to clarify current needsor to share process improvements can reduceproblems and avoid defects due to faulty mate-rials or inadequate service.

Definition of Total QualityLeadership

The Department of the Navy’s definition of TQLis based on Deming’s flow diagram that showsproduction as a system (cf. Deming, 1986, p. 4)(see Figure 3, p.22 of this document). Thisdefinition was developed during the initialapplication of Deming’s ideas to the operationsand management of naval aircraft overhaulfacilities (Walton, 1990).


“The application of quantitativemethods . . .”

The term “quantitative methods” refers tostatistical and other graphical tools that sum-marize data in a structured way (cf. Brassard &Ritter, 1994). These methods help in the identi-fication, understanding and control of factorsrelated to good or poor performance.

“. . . and the knowledge of people . . .”

Most process information does not reside inthe existing financial accounting or manage-ment information systems. Rather, processinformation is in the minds of the people--enlisted personnel, workers, officers, manag-ers, and supervisors who are responsible for aprocess. It is not just individual knowledge thatis important, but the collective knowledge of allthose who are involved with the process.

People in the process must work as a team tocontribute to the information, ideas, and ac-tions needed to improve a process. One of theprincipal differences between TQL and someproblem-solving approaches (e.g., task forces,tiger teams) is that the people doing the analy-sis and improvement are process owners, i.e.,those who are already responsible for processperformance. As indicated during the discus-sion of the “extended process” concept, theknowledge of customers and suppliers is also

very valuable in understanding and improvingprocesses.

“. . . to assess and improve . . .”

TQL uses measurement and statistical analysisto (1) assess the causes of process problemsand (2) evaluate the effects of changes to thesystem. The scientific approach to processimprovement requires that process perfor-mance be assessed and understood prior tomaking changes to it.

Improvement of a process involves changingfactors that strongly influence or “cause” pro-cess performance. These factors are oftengrouped into four categories: materials, meth-ods, people, and machines. The most signifi-cant factors require action by management toachieve lasting gains in improvement. Forexample, improving the performance of a FleetIndustrial Supply Center’s process might in-volve changing the delivery times of suppliesfrom a contractor, changing employee training,or revising work procedures. An individual orwork group probably would not have the au-thority to make these changes. This is thefundamental reason for management teams towork on a process.

Assessment and improvement of all mission-essential processes are fundamental to TQL.When processes are assessed initially there


improvement takes an investment in resourcessuch as people and funds. Applying theseresources where they may have the mostimpact makes good sense.

“. . . now, and in the future.”

“Now” means improving quality of currentprocesses. The “future” refers to preparing forevolving or anticipated mission changes. TQLembraces both present and future throughthe two-phase implementation approach. Thefirst phase focuses on continuous improve-ment of existing processes that are respon-sible for mission effectiveness. The secondphase includes re-engineering processes orcreating new products and services to meetthe anticipated needs of end-users—sailorsand marines.

may be a lot of waste and redundancy in pro-cess steps. Teams are able to identify andeliminate waste, which will lower costs almostimmediately. This reduction in costs can thenbe invested in innovations to that particularprocess or to other processes. This reinvest-ment strategy can only be leadership-directed:the decisions concerning what to do with thecost savings are ones that must be based uponmanagement priorities.

“. . . all significant processes within theorganization . . .”

Significant processes are directly related tomission performance. They are the activitiesthat produce the products or services of anorganization. For example, a significant pro-cess for a guided missile cruiser would be all ofthe activities necessary to launch missiles.Significant processes for a Navy Special War-fare unit might include beach reconnaissanceand underwater demolition of obstacles.

These processes are aided by internal opera-tions that are necessary but by themselves donot meet the mission requirements of an orga-nization. For example, providing meals, offeringtechnical training, and maintaining personalrecords might contribute indirectly to missionperformance. Improving these processesshould be a secondary priority. The primaryfocus is on significant processes because

Section


2Adoption of the DemingPhilosophy

The leadership of the naval aviation logisticscommunity initially adopted the Deming ap-proach because (1) productivity needed toincrease to respond to potential competition,(2) the leaders recognized the approach couldaddress those management practices in theircommunity that inhibited productivity(Dockstader, 1984), and (3) because of itsproven effectiveness both in Japan and theUnited States.


poor quality are prevented in the first place,there is a reduction in inspection and reworkcosts. These savings alone should lead toproductivity improvement. It is important tounderstand the difference between these twoways of achieving quality:

Quality by inspection

When enhanced performance is pursuedthrough inspection, improvement is basedupon failure. The focus of management is onproducing products or services, then sortinggood from bad. Improvement efforts under thisapproach tend to concentrate on increasingthroughput or reducing production costs. Qual-ity is managed by finding defects and errorsthrough inspections and audits. Costs of thisapproach include the cost of performing thework the first time, the costs of inspection, andthe costs of recovering from failures.

Subsequently, the Secretary of the Navy, theChief of Naval Operations, and the Comman-dant of the Marine Corps adopted the ap-proach for practice throughout the Departmentof the Navy. They anticipated the downsizing ofthe naval community and believed that a qualityfocus was a way of preserving the integrity ofthe naval service mission at the same time thatresources were being reduced.

The Economic Rationale for thePractice of TQL

The economic rationale that underlies theDeming philosophy is the chain reaction ofquality and productivity. Deming proposed thatimproved quality leads to improved productivitywhich, in turn, leads to business survival andgrowth (1986). As the DON adapted Deming’sphilosophy, it was determined that the finaloutcome of a quality and productivity chainreaction would be “national defense remainsstrong.” The DON adaptation of Deming’s chainreaction is presented in Figure 1.

Understanding the relationship between im-proved quality and decreased costs dependsupon different assumptions and approaches toproductivity. In the past, most people equatedimproved quality with increased inspection and,therefore, believed that improving quality in-creased costs and lowered productivity. UnderTQL the assumption is that if the causes of

The Chain Reaction in the DON

Improvequality

Costdecreases

Productivityimproves

Mission readinessimproves

National defenseremains strong

Figure 1. The chain reaction in the DON.


Quality by prevention

The prevention approach to quality improve-ment is based upon the assumption that highor low quality is an outcome of the process thatis used to produce the product or service. If theprocess—the interaction of people, machines,methods, and materials—works well, then highquality will result. Walter Shewhart, a statisti-cian and contemporary of Deming, confirmedthis assumption at the Bell Telephone Labora-tories (Shewhart, 1939). Use of this approachdeters failures, the costs of failure, and thereliance on inspections.

However, there are several reasons why theinspection approach continues to be the domi-nant approach to quality:

1. Some inspections must be conducted toavoid threats to life and property.

2. People do not clearly understand the impor-tant differences between inspection andprevention approaches to quality.

3. People do not think they are able to makechanges that could prevent failures.

4. Changing to a new system involves risk-taking, and the fear of failure leads to con-servative decisions (Suarez, 1993).

5. It is frequently easier and more rewardingto respond to the urgency of a failure thanto take the actions required to avoid prob-lems.

The Three Components of theDeming Philosophy

Deming’s quality philosophy is based on pro-found knowledge, leadership principles, andthe learning cycle. The system of profoundknowledge leads to the practice of those prin-ciples that, in turn, lead to the use of the learn-ing cycle (also known as the continuous im-provement cycle or the “Plan-Do-Check-Act[PDCA]” cycle). Profound knowledge can beincreased by using the learning cycle. Descrip-tions of the three components follow.

System of Profound knowledge

Profound knowledge provides the knowledgeand theory needed to understand and improveorganizations. It is made up of four interrelatedparts: (1) theory of knowledge (the develop-ment, testing, and application of hypotheses),(2) theory of variation (identifying factors andinteractions that affect quality through mea-surement and analysis of data), (3) generalsystems theory (understanding and dealingwith the dynamics of internal organizationalcomponents and the interrelationships of anorganization with its external environment), and(4) psychology in the workplace (finding andusing effective teaching, communication, incen-tives, and teamwork skills). Deming indicatesthat one need not be an expert in any one ofthese areas, but rather have a working knowl-edge of all four areas to make improvements.


put. Because this application of the scientificmethod is cyclical and ongoing, and becausethe components of profound knowledge inter-act, the growth in knowledge is much likecompounding interest—multiplicative ratherthan additive.

Viewing and Managing Organizations asSystems

A fundamental premise of Deming’s theory ofquality management is that an organizationbehaves as a system. Organizational effective-ness is greatest when the parts of that systemwork well together to achieve an aim or mis-sion. Such a system is then optimized. Demingdepicted this premise in a diagram (Figure 3).There are several very important implicationsfrom viewing an organization as a system.

Figure 2. The PDCA cycle.

The PCDA Cycle

1. Plan a change forimprovement

2. Carry out thechange on a smallscale

4. Act on what waslearned

3. Analyze andinterpret effects of thechange

5. Repeat step 1, with new knowledge6. Repeat step 2, and onward

Act Plan

Check Do

Deming’s “14 obligations” of leadership

Deming describes 14 leadership principles thatare derived from profound knowledge. They arealso known as obligations because leaders areseen as being directly responsible for theiradoption and incorporation into an organiza-tion. The aim of the 14 principles is to improveperformance while eliminating harmful beliefsand practices. (The 14 principles are listed onthe inside of the back cover of the Primer.)

Deming believed that the 14 obligations de-scribe a management system that cannot beapplied on a piecemeal basis. All are requiredto ensure the future success of organizations.

Application of the scientific method

The “PDCA” cycle (Figure 2) will be presentedin greater detail in Section V. It can be de-scribed as the systematic study of the causesof variation in quality and an approach toimproving quality. The PDCA cycle involved thefollowing steps:

1. Plan a change for improvement2. Carry out the change on a small scale3. Analyze and interpret effects of the change4. Act on what was learned5. Repeat step 1, with new knowledge6. Repeat step 2, and onward.

A benefit of using the cycle is increased knowl-edge to understand, predict, and control out-


tomers, there may be beliefs and practices ofan organization that make it difficult to use thisapproach. Examples are:

A hierarchical perspective that can en-courage members of functional depart-ments to be self-serving and more respon-sive to departmental goals than to organi-zational ones.

Performance appraisal and reward sys-tems that can concentrate on individualbehavior and subsequently reinforce effortsbased on self-interest rather than the long-term interests and performance require-ments of the organization.

Lack of constancy of purpose or aim,which can cause fragmented, unfocusedwork efforts.

Emphasis on short-term gains andshort-term thinking, which doesn’t permitfocus on strategic goals.

Hope for easy, simple, and quick solu-tions to major problems that require littleor no leader involvement.

The belief that just solving problems,automating processes, or installing newequipment will result in optimum perfor-mance without considering the wholesystem. Actions based on this belief canlead to increased work complexity anddegraded performance.

System optimization requires that an orga-nization is led and managed to focus on theaim of the organization. In Deming’s diagram,the consumer research is the starting place,which begins with assessing consumer satis-faction with current products and services.

The systems perspective includes custom-ers and suppliers. An external customerorientation is necessary to provide an aim foran organization. Without an aim, theorganization’s activities can become scatteredor internally focused. Figure 3 shows thatconsumer information is used to design theproduction or service process. Tests are per-formed and changes made to the process tosatisfy the requirements revealed from theconsumer research.

As compelling as the argument is for focusingan organization on what is requested by cus-

Figure 3. The organization viewed as a system.

Suppliers ofmaterials and

equipment

Organization Viewed as a System

Receipt andtest of

materials

Design andredesign

Consumerresearch

Consumers

Distribution

Production, assembly, inspection

Test of processes,machines, methods, costs

(Deming, 1986)

ABCD


characteristics unique to leaders (Suarez,1992). It is the responsibility of leaders to:

Teach their people how the work of thegroup supports the aims of the organiza-tion.Act as a coach and counselor, rather thansimply as a judge.Not rely solely on formal authority, ratherdevelop systems knowledge and interper-sonal skills.Be an unceasing learner. Encourage every-one to study.Create an environment that encouragesparticipation and innovation.

Reliance on a quality control departmentto take care of performance problems.

Deming labeled these beliefs and practices“deadly and dreadful diseases” of manage-ment. Holding these beliefs will not lead tooverall sustained organizational improvement.Deming’s “14 Obligations” are practices thatseek to ameliorate the “deadly and dreadfuldiseases” while promoting a long-term commit-ment to optimizing organizational performance.

For further information and discussion of thesepoints, a bibliography is provided. A goodstarting point is The Deming Route to Qualityand Productivity by William W. Scherkenbach(1988).

The Role of Leaders

The leaders of an organization have the primeresponsibility for the quality produced by theorganization, i.e., the success of the mission.The commitment and participation of leadershave long been recognized as critical factors insuccessful organizations (Tichy & Devanna,1990). Only leaders have the sufficient author-ity, influence, and access to information tobegin and maintain major organizationalchange.

In support of these leadership practices,Deming identified some responsibilities and

Section

35Total Quality Leadership: A Primer

3

34 Total Quality Leadership: A Primer

DON Implementation Approach

Within the DON, TQL is implemented in twophases. The first phase concentrates on con-ducting quality improvement and establishingthe resources needed to maintain the practiceof TQL. Process management is the means toaccomplish this phase. The second phaseinvolves extending process management to allsignificant processes important to the missionof the organization, working with suppliers andend-users, and meeting the needs of the end-user in the future. Strategic management is themeans to accomplish this second phase.


Process Management

Phase One establishes the practice of processmanagement. The major steps of processmanagement are (1) identification and trainingof personnel to undertake initial improvementprojects, (2) undertaking initial projects to gainexperience with and obtain results from pro-cess management, (3) expansion and supportof efforts to improve significant processes, and(4) removal of organizational impediments toimprovement. This approach, depicted in Fig-ure 4, can be applied to any organization in theDON, to major elements such as fleets orsystems commands, or to the DON as a whole.

Process management differs from traditionaloperations management in a number of ways.It is:

The two-phase approach takes into accountorganizational realities. This phased approachwas designed because:

1. Organizations do not have the resources toimprove the entire organization at once.Phase One provides an approach for decid-ing what to work on first and how to applynew methods for improvement.

2. Education and training need to be coupledwith improvement initiatives so that they areprovided at the appropriate time. A sequen-tial command-wide training plan is part ofthe implementation plan developed bysenior leaders during this phase.

3. The commitment of military senior leadersto improvement efforts can be effected bytheir scheduled tour rotation. To encouragecommitment, Phase One promotes activi-ties that yield benefits during a leader’s tourof duty.

4. Lessons learned from a command’s qualityimprovement initiatives need to be under-stood and impediments to process manage-ment removed before expanding the appli-cation of TQL. Phase Two provides anapproach to exploit this learning.

Figure 4. Senior leader responsibilities for process management.

Educate/train senior leader and executive-levelgroupSelect/train support personnelTrain quality improvement teams

Develop TQL implementation planCreate a quality environmentProvide resourcesCharter quality improvement teamsEstablish the practice of commandwide processmanagement

Plan for the reinvestment of resourcesIdentify/remove impedimentsMonitor/assess progressAct on teams’ recommendationsExtend education/process management efforts

Educate& train

Initiateprojectefforts

Support/extendprocess

managementefforts

SeniorLeader

Responsibilitiesfor Leading

ProcessManagement

Improve

Mission

Performance


The knowledge and skills required for processmanagement include systems thinking, teamleadership, applied statistics, and the psychol-ogy of work. As a cost-effective training ap-proach, commanding officers have been in-structed to send personnel to DON TQLcourses to become trainers within their ownorganizations.

Strategic Management

The second phase of implementation extendscontinuous improvement to the strategic level,focusing on systemwide implementation andalignment of work processes and managementsupport systems. Phase Two implementationaddresses the issues of (1) sustaining improve-ment efforts when military leaders rotate, (2)removing organizational structure and bureau-cracy that inhibit change, and (3) identifyingand meeting future mission requirements orneeds of end-users.

The methodology for guiding changes duringPhase Two is strategic planning and strategicmanagement. Specific guidance for strategicplanning is presented in A Handbook for Stra-tegic Planning by Wells and Doherty (1994);guidance for strategic management is given inStrategic Management for Senior Leaders: AHandbook for Implementation by Wells (1996).

Strategic planning is defined as “the process bywhich the guiding members of an organization

1. Proactive management that seeks to iden-tify and remove causes of errors to preventoccurrences of failures. Traditional manage-ment of quality tends to deal with failuresafter the fact through problem-solving.

2. A team effort that seeks to involve as teammembers all those responsible for andinvolved in the process.

3. Based on objective sources of measure-ment to support decisions, using data,statistical methods and decision rules fortaking actions on processes. Measurementsources include input (materials from sup-pliers), the output (products and services)provided by an organization, and the pro-cesses (interaction of people, materials,methods, and machines) that produce theproducts and services.

4. Continuous, an ongoing pursuit of improve-ment, rather than episodic or crisis-driven.Leaders will still respond to problems, butthey will focus on prevention of problemsthrough continuous improvement of theprocesses that lead to mission effectiveness.

To practice TQL, the leader of a unit mustestablish process management as the day-to-day management methodology. An organiza-tional unit such as a squadron, a ship, or anyshore-based command is the focus for imple-mentation of process management.


management approaches used during PhaseOne, with a greater emphasis on systemsthinking and measurement.

While process management primarily focuseson improving current processes, strategicmanagement focuses on ensuring the organi-zation is working on the “right” processes tomeet current and future requirements. Thestrategic approach is a systems method forchanging the overall organization, not a pro-cess-by-process approach as used whengetting started in process management.

The senior leaders are responsible for manag-ing systemwide changes necessary to optimizemission effectiveness. They must develop andimplement the strategic plan, committing thetime, guidance, and resources necessary toachieve success. Some of the major leaderactivities in strategic planning and manage-ment are expanded on in Figure 6.

Strategic planning

The leaders set the aim and direction for theorganization by clarifying (1) the mission—whythe organization exists, whom it serves andwhat it provides, (2) the vision—a view of theorganization that addresses needs of the end-users in the future, and (3) guiding principles—a reflection of the values of the organization,the quality philosophy, and how these valuesare to be employed in day-to-day management

Figure 5. A general strategic management model.

envision its future and develop the necessaryprocedures and operations to achieve thatfuture” (adapted from Goodstein, Nolan, &Pfeiffer, 1992). Strategic management is thenthe “management system that links strategicplanning and decision-making with the day-to-day business of operations management”(Gluck, Kaufman, & Walleck, 1982) (see Figure5). The strategic approach is a top-down sys-tematic way to institutionalize what the organi-zation does and how it accomplishes its mis-sion. It focuses on current and future pro-cesses, integrating overall goals, and helpsleaders understand the implications of aligningmanagement systems so that they are allfocused on the mission and the future. Strate-gic management requires the same tools and

The Strategic Management Model


to achieve the goals and objectives. Leadersneed to ensure that plans contain measurablemilestones so that progress can be tracked.

Implementation

By turning the strategic plan into action, theorganization aligns its significant work pro-cesses and identifies other management sys-tems that need to be changed. While planningis top-down, implementation begins at the levelwhere specific objectives are worked on, lead-ing to accomplishment of strategies and, ulti-mately, goals. Roles and responsibilities formeeting goals are defined. Organizations witha well-established cross-functional team struc-ture should use it where possible since organi-zational goals more than likely will be cross-functional. For goals defining new missions,additional teams may need to be established.Through this infrastructure, plans for day-to-day business are linked and resource needsidentified.

Strategic Measurement

Measures that indicate mission effectiveness(outcome measures) will be developed. Theseshould reflect how well strategic initiatives (i.e.,goals to move toward the vision) are being met.Most current performance measures focus onefficiency or financial measures (e.g., amountof funds expended at end of the fiscal year).While these may be necessary for day-to-day

and decision-making. Organizational goals arethen developed to reflect what needs to bedone to move toward the vision. Strategies arethe operational statements that describe howthe strategic goals are going to be achieved.Objectives are the specific, measurable short-term and mid-term performance targets thatrepresent interim steps for achieving thestrategies.

Deployment of plans

Everyone in the organization will participate instrategic management, beginning with theleaders. Senior leaders begin by reachingconsensus on goals and developing a plan ofaction. They then obtain input from their imme-diate subordinates, or direct reports, prior topublication. The plan is then communicatedwidely, with actions identified that are needed

Figure 6. Senior leader responsibilities for strategic management.

Set the aim and direction for organizationDevelop goals & strategies to meet needs offutureProvide resource & support for implementation

Develop plan of action for implementationCommunicate plan throughout organizationUse cross-functional teams working on goals

Identify & change policies to match goalsAlign organizational structure to matchorganizational aim & directionChange accounting & personnel systems tomap to organizational requirements

StrategicPlanning

Deployment&

ImplementationPlans

StrategicMeasures

SeniorLeader

Responsibilitiesfor LeadingStrategic

Management

Improve

Mission

Effectiveness

Develop mission effectiveness measuresLink effectiveness measures to input/process/output measuresAssess progress on goals/make decisions

ManagementPolicies/SupportStudies


Decision-making will shift lower in theorganization because teams will controlwork processes.

Information and reporting requirements willchange to support cross-functional work onorganizational goals.

Organizational structure will evolve to acustomer-focused or process-orientedstructure.

Compensation and reward systems willneed to become more clearly aligned withperformance and organizational goals.

These issues and others should be addressedwhen the strategic plan is revised. By using thestrategic management process for directingorganizational change, an organization’s com-ponents will become aligned and integrated tomaximize overall performance.

In summary, strategic planning and manage-ment are intended to help organizational com-ponents work together with a common purposetoward a shared vision. They are a way ofaligning all work processes and involvingcustomers and suppliers to help determine andmeet future requirements. Strategic planningand management can be used to gain supportfrom a parent command for the course chartedby the plan and to obtain needed resourcesexternal to the organization. The plan and

business management and may be useful forinvestigating why an organization is not accom-plishing its strategic goals, they may not bemeasuring mission effectiveness or how wellend-user needs are being met.

Strategic Management and PDCA

The leadership uses the PDCA cycle to revisethe strategic management effort. Organiza-tional improvements are strategically“Planned.” The planned changes are thendeployed and implemented, reflecting the “Do”phase. Progress on objectives and goals is“Checked” and “Acted” upon, using the appro-priate performance measures. Actions basedon this information can include developing newplans to continue the cycle of improvement.

Organizational Implications of StrategicManagement

As quality improvement activities becomestrategically oriented and widespread in anorganization under Phase Two, there will beeffects on all organizational systems. As anorganization matures in its application of TQL:

There will be shorter chains-of-commandand fewer functional structures becausecross-functional teams will be managing thework processes.

Section


4

management efforts demonstrate theorganization’s commitment to providing qualityproducts and services, now, and in the future.

TQL Roles and ManagementStructure

At the beginning of TQL implementation, par-ticipation must be planned and managed fromthe top for two basic reasons: (1) the trainingneeded to get underway is substantial andrequires resource decisions, and (2) the selec-tion of initial processes for improvement re-quires decision-making at the highest level toensure buy-in and success.


Defense organizations pursuing their missionsare no different from other service organiza-tions in that everything created is the result ofprocesses. The application of process manage-ment in a military operational unit should focuson developing the capability of performing amilitary mission. As mentioned earlier, TQL isnot intended as an approach to conductingoperational missions.

TQL teams

In an organization practicing TQL, teams arecreated to represent the top, middle, and work-ing levels of an organization. The highest-levelteam is called an Executive Steering Commit-tee (ESC). Teams of mid-level leaders arecalled Quality Management Boards (QMBs).Teams of individuals who work in a process arecalled Process Action Teams (PATs). While allthree levels of teams are expected to share acommon approach to improvement, the PDCAcycle, they have different roles and responsibili-ties, as shown in Figure 7.

ESCs

ESCs represent the executive level. For navalorganizations, an ESC should include thecommanding officer, senior civilian, departmentheads, and senior enlisted person. The ESCcollects and uses information from theorganization’s customers and other externalgroups (e.g., regulatory agencies). It developsan implementation plan and selects improve

Process Management and the Structureof Teams

Teams need to be formed that reflect existingownership responsibilities and the way thework is actually performed. Contrary to the waymanagement structures appear on hierarchicalorganization charts, work is actually accom-plished through processes that flow horizon-tally, across the organization. The up-and-downvertical flow on the current organizationalcharts only reflects how control is exerted fromthe top to the bottom, an effective structure forcommunication top-down. However, “vertical” isnot how the work flows, which is why the hier-archical structure may be a barrier to efficientprocesses (Rummler & Brache, 1991).

Organizations that focus on hierarchical rela-tionships can suffer from competition andrivalries between functional areas, poor com-munications, and narrow perceptions of mana-gerial responsibilities. Avoiding these barriersto performance and promoting the effective useof teams require knowledgeable leadershipattention.

An important task of management is to spanfunctional boundaries so that the output fromone functional area meets the needs of thefunctional area receiving the product (theinternal customer). At each step, value isadded so that what is produced is a value-added output for the external customer.


Using the process data, QMBs make changesby removing impediments or changing theprocess. If QMBs identify changes that requirea higher level of authority, then they submitthose recommended changes to the ESC foraction.

PATs

PATs are made up of individuals who workdirectly in a process. These teams are char-tered by a QMB to assist in the process man-agement effort because of their (1) knowledgeof process performance and (2) location in theprocess where data are to be collected. Acritical responsibility of PATs is to collect, ana-lyze, and provide summary information toQMBs about processes. PATs also take actionsto stabilize process performance. If they iden-tify changes that they cannot make at theirlevel of authority, then they submit thosechanges as recommendations through thechain of command to QMBs.

The TQL teams are supported by internalconsultants known as TQL coordinators andquality advisors. A TQL coordinator is theindividual selected to support the ESC, whilequality advisors support QMBs and PATs. TQLcoordinators and quality advisors provide just-in-time training and assistance in the applica-tion of management and planning methods,process analysis tools, and principles of effec-tive teamwork. These people are trained to

ment goals. It charters and supports the analy-sis and improvement efforts conducted bysubordinate teams. During Phase Two the ESCis responsible for strategic planning and strate-gic management, implementing the manage-ment changes needed to optimize missioneffectiveness.

QMBs

QMBs are cross-functional teams of top- andmid-level managers chartered by the ESC whoare jointly responsible for significant processes.A QMB uses the combined knowledge of itsmembers to select the process areas or factorsthat contribute the most toward achievingperformance improvement. As needed, QMBsorganize subordinate teams, PATs, to collectand analyze information to identify the processfactors influence the quality of performance.

Figure 7. Integrative management structure.

Leads the implementation of TQLEstablishes the practice of process managementEstablishes conditions for strategic management

Conducts process managementCoordinates cross-functional effortsCharters PATs

Integrative Management Structure

Assists QMBsCollects process dataIdentifies special causes

ExecutiveSteering

Committee

QualityManagement

Board

Process ActionTeam


mission effectiveness and should be part ofapplying TQL tools and methods. They must betaught how to perform as effective team mem-bers or team leaders and how to apply thescientific approach to improve processes. Whileparticipation and the use of teams are impor-tant aspects of TQL, they do not eliminate theauthority and responsibility of senior leaders tomake unilateral decisions as required.

provide this assistance through completion ofDON TQL courses offered through NavalLeadership Training Units in Little Creek, Vir-ginia, and Coronado, California.

TQL Team Structure and theChain of Command

Quality improvement is managed through thisteam structure to provide an efficient means tooptimize the performance of the organization.The chain of command is responsible for im-proving work and management systems. Forcommands with several levels, it is likely thatprocess improvement and management willinvolve two or more levels in the organization.Linking the teams, from higher to lower levels,is accomplished through an individual from ahigher-level team who serves as a “linking pin.”The linking pin is responsible for clarifying thesubordinate team’s charter to avoid an overlapor omission of improvement activities. Both theteam structure and the use of linking pins areintended to maintain an effective chain ofcommand and ensure mission-focused im-provement efforts.

In summary, effective process managementrequires organizing people who are processowners into teams. Given the focus on missionperformance, the application of TQL should notbe viewed as a voluntary initiative. Everyone inan organization is expected to contribute to

Section


5Application of the ScientificMethod

Application of the scientific method to organiza-tional performance is conducted through the“Plan-Do-Check-Act” (PDCA) cycle. The PDCAcycle is an objective method of acquiring andapplying knowledge to improve performance.This cycle was developed and applied byWalter Shewhart (1939) as a way to improvethe production systems of organizations. Figure2, displayed earlier in this document, isDeming’s version of this cycle (Deming, 1986).


lems, their potential causes, and solutionsmust be based on objective information, notanecdotal evidence or subjective perceptionto guide improvement activities. The deter-mination of causes as well as the effective-ness of efforts to improve mission perfor-mance must be verified with data.

Use analytic tools to gain new knowl-edge. Analytic methods and tools helpteam members to collect, organize, andinterpret information. They also serve as acommon language that aids in communica-tion and decision-making within an organi-zation. Without the discipline offered bythese tools and methods, it is difficult for anorganization to learn. When an organizationdoes not learn, it risks repeating mistakesor applying the same ineffective solutionsover and over again (Rodriguez, Landau, &Konoske, 1993).

Address causes of performance prob-lems. There are two kinds of causes ofproblems associated with process perfor-mance. These are known as commoncauses and special causes. The ability todistinguish between the two causes andtake appropriate action is essential toimprovement.

1. Common causes are sources of variationdue to the system itself or the way thesystem is managed. They represent

Use of the PDCA Cycle

Figure 2 shows a procedure for improvingquality by making process changes. The typesof changes that are evaluated could be (1)actions taken to avoid deterioration of thecurrent performance due to unexpected events,such as accidents or emergencies, or (2) thosedesigned to improve future performance of aprocess or system. In both of these circum-stances, a “Plan” needs to be formulated, “Do”is the execution of that plan, and “Check” is anevaluation of data to determine if the plannedchanges are effective. In the “Act” portion of thecycle, the findings from the “Check” phase areused as a basis for taking actions that institu-tionalize useful changes.

TQL Adaptations of the PDCA Cycle

The DON has developed material on the PDCAcycle to aid commands in carrying out basicprocess improvements and redesign efforts.These are A Total Quality Leadership ProcessImprovement Model (Houston & Dockstader,1993) and the Systems Approach to ProcessImprovement course (Rodriguez, Landau, &Konoske, 1993). These adaptations sharecommon properties in that they:

Require empirical evidence. In TQL,objective information takes precedence oversubjective perceptions as the basis fordecision-making. The identification of prob-


ways to achieve their missions. Effectiveapplication of the PDCA cycle requires theongoing acquisition and use of new knowl-edge to address emerging mission needs.

Are value-focused. Pursuing improvementthrough TQL does not mean quality at anycost, but rather quality at a cost the user iswilling to pay. Improving mission effective-ness begins with reducing complexity andactivities that do not add value. Processredesign or re-engineering efforts that mayfollow initial improvements are designed toincrease the value of the process as itrelates to mission performance. This value-based orientation is fundamental to TQL.

sfactors that are inherent and have awidespread effect on performance, suchas the quality of incoming resources,training, or standard equipment or oper-ating procedures. Addressing commoncauses of performance typically requiressystem changes.

2. Special causes are sources of variationdue to isolated abnormalities or excep-tional occurrences in the system; theyare not a regular part of the system.Correcting the effects of special causesusually can be accomplished throughproblem-solving. Actions taken on specialcauses can lead to immediate results,but actions on the common causes cangenerate the greatest and most lastingbenefits.

Help organizations to be proactive. Byanticipating and preventing poor perfor-mance, the organization’s overall effective-ness is improved and limited resources areused efficiently. The organization can alsouse the PDCA cycle in conjunction withstrategic plans to identify and respond tonew requirements.

Are cyclical. As indicated above, statusquo is not good enough. Changes in mis-sion requirements, resources, and opera-tional constraints require naval organiza-tions to continually seek out new and better


Significant reductions in the budget of theDepartment of Defense have been ongoing.The Department of the Navy is committed tothe use of TQL as an approach to improvemission effectiveness under conditions ofreduced resources. This approach embraces adefinition of TQL that addresses short- andlong-term organizational goals, adoption of theDeming philosophy, an implementation ap-proach, a management structure and roles,and the application of the scientific method.Requirements for the successful use of TQLinclude education and training, leadership, andteamwork.

The DON TQL approach requires that com-manding officers begin the practice of process

Summary


management in their organizations. Onceimplementation is underway, the leader isresponsible for expanding improvement to allsignificant processes and ultimately the entireextended system. Then leaders can focus onsetting a strategic direction for the organizationand systematically deploying the goalsthroughout the organization. In this way theproducts and services can be directed atmeeting the future requirements of the navalforces to ensure a strong defense in the 21stcentury.

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9 Break down barriers between departments. People in re-

search, design, sales, and production must work together as

a team, to foresee problems of production and in use that

may be encountered with the product or service.

10 Eliminate slogans, exhortations, and targets for the work

force asking for zero defects and new levels of productivity.

Such exhortations only create adversarial relationships, as

the bulk of the causes of low quality and low productivity

belong to the system and thus lie beyond the power of the

work force.

11 a. Eliminate work standards (quotas) on the factory floor.

Substitute leadership.

b. Eliminate management by objective. Eliminate manage-

ment by numbers, numerical goals. Substitute leadership.

12 a. Remove barriers that rob the hourly worker of his right to

pride of workmanship. The responsibility of supervisors must

be changed from sheer numbers to quality.

b. Remove barriers that rob people in management and in

engineering of their right to pride of workmanship. This

means, inter alia, abolishment of the annual or merit rating

and of management by objective.

13 Institute a vigorous program of education and self-improve-

ment.

14 Put everybody in the company to work to accomplish the

transformation. The transformation is everybody’s job.

Deming’s 14 Obligations ofLeadership

1 Create constancy of purpose toward improvement of

product and service, with the aim to become competitive and

to stay in business, and to provide jobs.

2 Adopt the new philosophy. We are in a new economic age.

Western management must awaken to the challenge, must

learn their responsibilities, and take on leadership for change.

3 Cease dependence on inspection to achieve quality. Elimi-

nate the need for inspection on a mass basis by building

quality into the product in the first place.

4 End the practice of awarding business on the basis of price

tag. Instead, minimize total cost. Move toward a single

supplier for any one item, on a long-term relationship of

loyalty and trust.

5 Improve constantly and forever the system of production

and service, to improve quality and productivity, and thus

constantly decrease costs.

6 Institute training on the job.

7 Institute leadership. The aim of supervision should be to

help people and machines and gadgets to do a better job.

Supervision of management is in need of overhaul, as well as

supervision of production workers.

8 Drive out fear, so that everyone may work effectively for the

company.

Department of the Navy

Edited by Bobbie Ryan

Designed by Inés Muñiz-Suárez

Total Quality Leadership Office

2611 Jefferson Davis Highway

Suite 2000

Arlington, Virginia 22202-4016

TQLO Publication Number 97-02

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