Chapter 4: Process Focus 2.

Measurable: ability to capture important

quality and performance indicators to reveal
PROCESS
patterns about process performance.
 is a sequence of linked activities that is
AT&T, for example, identified the following
intended to achieve some result, such as
principles to guide their process management
producing a good or service for a customer
activities:
within or outside the organization.
 involve combinations of people, machines, 1. Process improvement focuses on the end-to-
tools, techniques, materials, and improvements end process. (according to the sequence of
in a defined series of steps or actions. tasks)
2. The mindset of quality is one of prevention
PROCESS MANAGEMENT
and continuous improvement.
Involves planning and administering the activities 3. Everyone manages a process at some level and
necessary to achieve a high level of performance in is simultaneously a customer and a supplier.
key organizational processes, and identifying 4. Customer needs drive process improvement.
opportunities for improving quality and operational 5. Corrective action focuses on removing the root
performance, and ultimately, customer satisfaction. cause of the problem rather than on treating its
symptoms.
Three (3) Major Activities: 6. Process simplification reduces opportunities
 Design: focuses on ensuring that the inputs to for errors and rework.
the process, such as materials, technology, 7. Process improvement results from a
work methods, and a trained workforce are disciplined and structured application of
adequate; and that the process can achieve its quality management principles.
requirements.
 Control: focuses on maintaining consistency
in output by assessing performance and taking IDENTIFYING PROCESS AND
corrective action when necessary. REQUIREMENTS
 Improvement: focuses on continually seeking
Leading organizations identify important processes
to achieve higher levels of performance, such
throughout the value chain that affect their ability to
as reduced variation, higher yields, fewer
deliver customer value.
defects and errors, smaller cycle times and so
on. Everything an organization does can be viewed as a
process. Common processes include the acquiring the
customer and market knowledge, strategic planning,
CYCLE TIME refers to the time it takes to research and development, purchasing, developing
accomplish one cycle of a process (e.g., the time from new product or services, manufacturing, assembling,
when a customer orders a product to the time that it is fulfilling customer orders, managing information,
delivered, or the total time needed to introduce a new measuring and analyzing performance, and training
product) employees.
- One of the most important metrics of process
management. These processes typically fall into two categories:

PROCESS OWNERS (individual or group) are

accountable for process performance and have the VALUE-CREATION PROCESSES: (core
authority to control and improve their process. processes) are those most important to "running the
- Creator of guidelines to accomplish a certain business" and maintaining or achieving a sustainable
product or services. competitive advantage.
- In charge to any modifications/improvement - Includes product design, production and
of a certain process to produce an output like a delivery process.
certain product/service that may be valuable to - Product design involves all activities that are
certain customers/clients performed to incorporate customer
requirements, new technology, and
To apply the techniques of process management, organizational knowledge into a functional
processes must be: specification of manufactured goods or
1. Repeatable: the process must recur over time. services.
SUPPORT PROCESSES are those that are most To describe the specific steps in a process and their
important to an organization's value-creation sequence, we generally develop a process map or
processes, employees, and daily operations. flowchart , along with standard operating procedures
and work instructions.

PROCESS REQUIREMENTS
PROCESS DESIGN FOR SERVICES
Understanding the requirements that processes should
meet is vital to designing them. Most cross-functional business value-creation
processes and all support processes are primarily
- Given the diverse nature of value-creation
service-oriented. Thus, it is important to understand
processes, the requirements and performance
the fundamental differences between manufacturing
characteristics might vary significantly for
and service processes.
different processes. In general, value creation
process requirements are driven by consumer  First, the outputs of service processes are not
or external customer needs. as well defined as manufactured products.
 Second, most service processes involve greater
interaction with the customer, often making it
easier to identify needs and expectations.
“On the other hand, customers often cannot define
their needs for service until after they have some point
of reference or comparison.”

A useful approach to designing services is to

recognize that services differ in three dimensions:
 Customer contact and interaction
 Labor intensity
PROCESS DESIGN  Customization
The goal of process design is to develop an efficient In designing service processes, the following
process that satisfies both internal and external questions should be considered:
customer requirements and is capable of achieving the
requisite level of quality and performance. 1. What service standards are required to be met?
2. What is the result of the service to be
Other factors that might need to be considered in provided?
process design includes: 3. At what point does the service begin, and what
1. Safety signals its completion?
2. Cost 4. What is the maximum waiting time that a
3. Variability customer will tolerate?
4. Productivity 5. How long should it take to perform the
5. Environmental impact service?
6. "Green" manufacturing (to reduce envi. 6. Who must the consumer deal with in
hazard) completing the service?
7. Measurement 7. What components of the service are essential?
8. Capability Desirable? Superfluous?
9. Maintainability of equipment 8. Which components can differ from one service
encounter to another while still meeting
standard?
TECHNOLOGY is an integral part of process design
that makes today's service and manufacturing
processes operate productively and meet customer DESIGN FOR AGILITY
needs better than ever.
AGILITY is a term that is commonly used to
characterize flexibility and short cycle times.
PROCESS MAPPING FLEXIBILITY refers to the ability to adapt quickly
Designing a process requires a systematic approach. and effectively to changing requirements.
MISTAKE-PROOFING PROCESSES 2. Treatment Errors
3. Tangible Errors
Typical mistakes in production are omitted steps in a
4. Customer Errors in preparation
process, setup errors, missing parts, wrong parts, or
5. Customer Errors during an encounter
incorrect adjustments.
6. Customer Errors at the resolution stage
- Checking of the process before the
implementation to mass consumers
Such errors can arise from the following factors:
1. Forgetfulness due to lack of reinforcement or
guidance PROCESS CONTROL
2. Misunderstanding or incorrect identification
because of the lack of familiarity with a CONTROL is the activity of ensuring conformance to
process or procedures the requirements and taking corrective action when
3. Lack of experience necessary to correct problems and maintain stable
4. Absent-mindedness and lack of attention, performance.
especially when a process is automated. - Control should be the foundation for
organizational learning.

Preventing mistakes can be done in three ways: Many companies have adopted an approach that has
been used in the U.S. military, called after-action
 Designing potential defects and errors out
review, or debrief.
of the process. Clearly, this approach is the
best because it eliminates any possibility that
This review consists of asking four basic questions:
the error or defect will occur and will not
 What was supposed to happen?
result in rework, scrap, or wasted time.
 What actually happened?
 Identifying potential defects and errors and
 Why was there a difference?
stopping a process before they occur.
 What can we learn?
Although this approach prevents defects and
errors, it does result in some nonvalue-added
PROCESS CONTROL IN MANUFACTURING
time.
 Identifying defects and errors soon after Manufacturing Control is usually applied to
they occur and quickly correcting the incoming materials, key processes, and final product
process. This can avoid large amounts of and services.
costly defects and errors in the future, but does
result in some scrap, rework, and wasted - Control in manufacturing starts with
resources. purchasing and receiving processes.
- Document control procedures are usually
written down in a process control plan –
written black and white document that has
POKA-YOKE (POH-kah YOH-kay) is an approach series of steps on how to accomplish an
for mistake-proofing processes using automatic output.
devices or simple methods to avoid human error.
PROCESS CONTROL IN SERVICES
Poka-yoke is focused on two aspects:
1. Prediction, recognizing that a defect is about For many services, process control follows the same
to occur and providing a warning, paradigm as in manufacturing:
2. Detection, recognizing that a defect has 1. define a standard or goal
occurred and stopping the process. 2. measure accomplishment
3. compare results with standard
The poka-yoke concept was developed and refined in 4. make corrections as needed.
the early 1960s by the late Shigeo.

PROCESS IMPROVEMENT
Typical types of service errors and related poka-
yokes. CONTINUOUS IMPROVEMENT refers to both
incremental changes, which are small and gradual, and
1. Task errors
breakthrough improvements, which are large and Reengineering – has been defined as “the
rapid. fundamental rethinking and radical redesign of
business processes to achieve dramatic improvement
Learning cycle stages
in critical, contemporary measures of performance,
1. Planning such as cost, quality, service, and speed.”
2. Execution of plans - Revision of process in order to improve the
3. Assessment of progress ongoing process of the company.
4. Revision of plans based upon assessment
findings
MANAGING SUPPLY CHAIN PROCESSES
CONTINUOUS IMPROVEMENT SUPPLY CHAINS are among the most important
business processes and can be viewed as
During 1950-1951 Toyota initiated some of the
encompassing may key value creation and support
earliest formal continuous improvement programs.
processes such as supplier selection and certification,
Toyota pioneered Just in time (JIT) which showed purchasing, logistics, receiving, and performance
that companies could make products efficiently with measurement.
virtual zero defects.
- Different operational processes which should
Kaizen is a Japanese word that means gradual and be done accurately from obtaining raw
orderly continuous improvement. materials, upon the delivery of output to the
customer.
Kaizen Event is an intense and rapid improvement
process in which a team or a department throws all its
resources into an improvement project over a short
Supplier Partnership
time period, as opposed to traditional kaizen
application, which are performed on a part time basis. SUPPLIER: includes not only companies that provide
materials and components, but also distributors,
transformation companies, and information, health
BREAKTHROUGH IMPROVEMENT care, and education providers.

Refers to discontinuous change, as opposed to Supplier Certification: These processes are designed
gradual, continuous improvement philosophy of to rate and certify suppliers who provide quality
kaizen. materials in a cost effective and timely manner.

BENCHMARKING is defined as “measuring your Certified supplier: defines as one, after extensive
performance against that best-in-class companies, investigation, is found to supply material of such
determining how the best in class achieve those quality that routine testing on each lot received is
performance levels, and using the information as a necessary.
basis for your own company’s targets, strategies, and
implementations”
- “the search for industry best practices that
lead to superior performance.”

The term BEST PRACTICES refers to approaches

that produce exceptional results.
- usually innovative in terms of the use of
technology or human resources and are
recognized by customers or industry experts.

Process Benchmarking – identifies the most effective

practices in key work processes in organizations that
perform similar functions, no matter in what industry.