Quality and CIP

2015

IPO Quality Charter

To promote and enhance system wide Velocity
focused on global optimization using the 5Vs.

Metrics
COPQ <1.1 % of Sales
CIP savings >1.5% of Sales

Velocity?
In basic terms, Velocity is speed with direction.
More importantly, it is the rate of change.
Two Questions arise
What is to be changed?
What is the rate of change?

What is to be changed?
Function of the Quality organization
Pre-1970
100% inspection
Time/Labor consuming
Ineffective 100% human inspection of parts is only about
80% effective. Quality Handbook, Sixth Edition: The Complete Guide to Performance
Excellence

No global standards
Inspecting Quality into the products

What needs to be changed?

Transitional Quality organizations (present state)

Labor intensive
Reactive vs. Proactive
Product vs. Process
Results vs. Actions
Quality control vs. Quality Assurance

Rate of Change
The Progress of change

Its not the progress I mind, its the change I dont like. Mark Twain
Progress is impossible without change, and those who cannot change their minds cannot change
anything George Bernard Shaw
The progress of change is directly related to the urgency for change.

The Process of change

Step 1: Create Urgency

Step 2: Form a Powerful Coalition
Step 3: Create a Vision for Change
Step 4: Communicate the Vision
Step 5: Remove Obstacles
Step 6: Create Short-Term Wins
Step 7: Build on the Change
Step 8: Anchor the Changes in Corporate Culture

A new Vision, Velocity

Quality Assurance must be seen as an
overarching organizational activity, not as a
departmental function.
The organizations goals should be focused at
increasing the rate of change (Velocity)
Change must be defined by global parameters
(CIP)

A new Vision, Velocity

Critical Path Focus
The critical path is the time from order acquisition to
receipt of payment.
Increasing the rate of change requires reducing the
critical path timeline.
You cant manage what you cant measure. W. Edwards
Deming

What are the 5Vs?

Verification and Validation

Variation
Value Add
Visual Management
Vendor Management

Verification and Validation

Validation is the process of checking whether
the specification captures the customer's needs
Front end document review, contract analysis, design review, etc.

Verification is the process of checking that the

product meets the specification.
Dimensional and visual inspection, NDE, chemical and physical testing,
etc.

Variation
The key element in achieving Operational Excellence
is to identify sources of variation that affect a process,
product or service. Six Sigma, as a methodology, has
at its roots a focus on variation.

Variation
A fault in the interpretation of observations, seen everywhere, is to
suppose that every event (defect, mistake, accident) is attributable to
someone (usually the nearest at hand), or is related to some special event.
The fact is that most troubles with service and production lie in the system.
We shall speak of faults of the system as common causes of trouble, and
faults from fleeting events as special causes. W. Edwards Deming

CIP and Lean

(not the same)

Continuous Improvement Process

CIP zeros in on culture (organizational maturity) and stimulates its
development. CIP focuses on the people and the success of the
organizational team requiring engagement, commitment and trust
through the continual improvement and refinement of the organizations
processes.

Lean
Lean is described as a production practice that focuses on the
elimination of wasteful elements in all process to increase the value to
the customer. Lean is actually a by-product of CIP.

Value Add Areas

Increase

Reduce

Improve

Create

Revenue

Cost

Productivity

Strategy

Profit

Time/Effort

Processes

System

Growth

Complaints

Service

Process

Market share

Risk

Information

Business

Retention

Turnover

Morale

Product

ROA/ROI

Conflict

Image

Partnerships

Efficiency

Paperwork

Reputation

Working Capital

Skills

Visibility

Quality

Employee Engagement

Loyalty

7 Low Cost Thinking Questions

(Rules for CIP)

Does the change reduce the critical path time-line

Does the change promote or enhance the Global Optima
Does the change simplify decision making (visual tools)
Does the change improve workplace safety
Does the change promote employee engagement and ownership
Is the change good for all stakeholders
Does the change add value for the customer (internal or external)

Visual Management
Visual management.
Whether it is scoreboards, production control charts, team communication boards, or other
types, visual management displays keeps vital information flowing between lean
management and employees, as well as between individuals, cells and departments.

Goal-setting and performance tracking.

Visual displays show what is expected and how the organization is performing against those
goals. These display boards are critical to success because they show trends in key
performance indicators.

Idea sharing and team communication.

Kaizen improvements achieve the best results when performed as a team-based endeavor;
communication boards serve a useful role in getting everyone involved in sharing ideas,
identifying root causes, and brainstorming countermeasures.

Report kaizen results and awards.

Visual displays are also beneficial for presenting results and recognizing achievements
among a kaizen event team. Tracking boards and visual management tools are especially
important in multi-shift operations where groups rarely have the opportunity to meet face-toface.

Vendor Management
Vendor management is a discipline that
enables organizations to

control costs,
drive service excellence and
mitigate risks to
gain increased value from their vendors throughout
the relationships life cycle.

Vendor Management
Cost Control

Scrap and Rework

Transportation
Re-inspection and test
Documentation

Service excellence

Additional value add services

Short lead times
Vertical integration
Favorable terms
Consignment

Risk Mitigation

ISO certification
Active 6S, Lean or CIP
Use of problem solving tools
Collaborative training
Process controls

Global Approach to Local Issues

Map the critical path at all sites (Local)
Flush all CIP projects using the 7 low cost thinking rules
and critical path (Local)
Gap analysis of the 5Vs (Team)
Develop local action plan with site (MS Project) (Team)
Process based
Manageable, measurable, achievable (Smart)
Coordinate with global resources (Project, Manufacturing, Quality,
Supply Chain)

Global Approach to Local Issues

Local GMs must own the project plan

Local Managers must champion the projects
Local resources must manage the process
Corporate resources must:
Train
Support
Mentor

Coordinate
Facilitate
Participate