Archive for the ‘Managing change’ Category

How to define a problem

February 3, 2014

Problems tend to be defined in terms of the pain felt by the organization. Consequently the solutions may relieve the pain or embarrassment only to increase the hidden costs of nonconformity. For example, in order to reduce production costs we must have longer production runs thereby generating expensive inventory.

But system thinking and customer focus can change this for the benefit of customers and the organization’s other stakeholders.

Customer-focused-system-thinking organizations define their problems by describing how they as systems will fail or did fail to fulfill customer needs.

Their problem definitions comprise three parts:

A. The customers’ requirements;
B. The evidence of the system not being able to fulfill customers’ timeliness, affordability and performance requirements (perhaps including the PONC*); and
C. The nature of the problem to be solved.

Example:

A. Customers’ requirements fluctuate at short notice;
B. System resists changing its processes resulting in loss of business and customer loyalty (PONC approx $100k pm); and
C. Unable to fulfill frequent changes in customer requirements due to long lead times.

Note that it is better to blame the system than a person.

And, of course, the problem may be an opportunity.

In this case the system’s problem solving, or problem dissolving, processes result in the actions necessary to change their system. The changes may include mistake-proofed short-run processes that respond fast enough to satisfy customer demand for different products while continuing to deliver quality and value.

You can also define your problems in terms of how your system fails to fulfill customer needs. Not only your customers will benefit, you’ll also create more successful stakeholders.

Thriving instead of just surviving

July 4, 2013

Thriving companies make effective use of resources to create successful customers. Zombie companies earn just enough to pay the interest on their debts. Low interest rates allow zombie companies to exist without investing in new products, processes and their management systems. As interest rates rise, the zombie companies will disappear unless they act now.

How do companies stop surviving and start thriving in this economy?

Refocus on your mission:

Your company’s mission is the reason your company exists. It is the system’s purpose. Cutting everything by 20% or more may be instinctive but without regard for the mission, it will put the system, your company, into a death spiral.

Instead, be creative. Your core process (from customer needs to cash in the bank) is mission critical. Determine the vital few changes that will yield most of the efficiency improvements.

Study your marketing and selling process. Perhaps you can go viral via social networks to explain clearly how your company creates successful customers. Study your innovation process. Do you fully understand, from the customer’s point of view, each of their objectives? Then design creative solutions with superlative service (see below) to help each customer to fulfill their objectives. Sell the value as seen by each customer but do not cut prices. Use your management system to improve efficiency and reduce costs but do not offer discounts.

Superlative customer service:

Companies often focus their management systems on tangible goods. Indeed, for nearly three decades, accredited registrars have encouraged their system certification clients to ignore their service design processes!

Leaders know that superlative customer service can influence each customer to buy on value instead of price.

Study your product design process. Ensure it designs the whole experience the customer has with your company. Engage your employees in the redesign of their interactions with customers by analyzing the customer’s experiences as they are. Agree upon the service changes so they are as they should be from the customer’s perspective. Make this new process part of your management system by changing the affected processes such as training, selling and maintaining the computer network. Continually improve the customer experience with your management system.

By engaging your employees in the redesign of their interactions with customers, you inspire them so they help your company to thrive again.

Reasons ISO 9001 projects fail or succeed

September 26, 2011

Big Q thinking says everything the organization does is for quality. Organizational thinking in this way can result in highly successful holistic system development projects. Some organizations, though, are stuck in little-q thinking, perhaps kept in that state of mind by their dying QC department.

Since 1986 here are four reasons we have observed for organizations failing to obtain the full benefits of ISO 9001:

1. The leaders are not willing volunteers in developing their system.
2. The leaders ignore the system that actually is their organization.
3. The leaders delegate implementation of procedures written around ISO 9001 instead.
4. The quality professionals do not include the financial processes in the management system.

The key to developing a process-based management system is to go with the flow of work in the organization.

Embark on a voyage of discovery rather than implementing a standard:

A. Discover what the organization already does to determine customer requirements (and get paid for meeting them).
B. Discover what the organization already does to fulfill these and other requirements.
C. Discover the processes in the management system (and determine any new ones needed by the management system).
D. Discover what is done in each process to prevent nonconformity instead of how nonconformity is detected.

Telling an individual to implement ISO 9001 is not a good idea. The system development project needs a cross-functional team that is able to analyze its system, determine its key processes and analyze each of those key processes and their interactions.

Just a few of the management system’s processes need to be newly designed and implemented after training of the process team.

Respect the system that is the organization otherwise the system development project will fail. One way to do this is to use the “as-is rule”. Document the process lightly as it is not as you would like it to be. Then, by using and improving the management system it will cause any needed improvements and grow the detail where needed.

What if the process is so bad it does not conform to the standard? Well then, use the two-week rule: record the nonconformity and say “you have a fortnight to correct the process then we will re-document the improved process as it is”. If too difficult to correct in two weeks then feed the nonconformity into an early corrective action using the newly developed management system.

A summary of common mistakes:

i) Leaders not showing their commitment to requirements.
ii) Putting the documented procedure ahead of the process.
iii) Ignoring the system that is the organization.
iv) Implementing ISO 9001 instead of developing the organization’s existing management system.

The system should help people to determine and meet requirements including the requirement for continual improvement. The procedures should be owned by the people not the “we know best department”. That way QA is delivered as a result of everyone using their management system to fulfill requirements.

Learn how to do this for yourselves here.

Imagine a Japanese Car Company…

February 23, 2010

…that decides to expand. New suppliers are key to this expansion. Instead of licensing proven designs it invites its new suppliers to create new designs. These designs may or may not have been analyzed to determine and eliminate or make safe their modes of failure.

Dangerous modes of failure remain in some designs as they rush to production and assembly confident of their world famous production system. It is unclear from the many books written of the marvels of this production system if it reaches back far enough to include design.

Meanwhile the government of the country, that is home to many of its customers, decides to buy a majority of the stock in a major competitor.

Cars that look as if they will continue the legacy of success are eagerly bought by loyal owners. Problems are reported by some of these owners. The system remains unimproved.

Problems reported by some employees also fail to get through to top management. The company’s leaders have too much faith in the infallibility of their lauded system.

Unfortunately some owners, their families and friends die as some components of their new or nearly new cars fail in an unsafe way.

After years of celebrating this company and its cars the press decide to question and investigate the quality and safety of it products.

Reluctantly the favorite car company of many decides to recall and fit a plate to reduce the friction in the unproven design so the accelerator pedal will not stay down after the driver lifts his or her foot.

Now it is the cross-hairs of the legislative branch of the government that owns one of its largest competitors!

After fixing their cars will this company fix the integrity of its system to survive?