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Given today's analytical tools
and Internet technology, spreading quality and process information
throughout an enterprise has never been easier. Nor has
it ever been so important: The growth of supply chain management,
quality initiatives such as Six Sigma and ever-tightening
customer specifications and expectations mean that continuous
process monitoring and improvement is everyone's responsibility.
With the right tools in place, anyone--from finance to sales
to shipping--can look at control charts and other graphs
with the click of a mouse.
But it's still a hard sell, isn't it? Driving process
intelligence throughout the enterprise can be harder than
pushing a string. However, before we look at the obstacles
in more detail, let's consider how a successful process-intelligent
enterprise should operate.
Process literacy means generating and efficiently distributing
process information to people who will use it throughout
the enterprise to improve the company's bottom line.
A process-intelligent enterprise:
Knows its processes. The process is flowcharted, and critical
parameters and monitoring points are identified.
Knows how to measure and monitor critical process points.
It must capture measurements with minimal interruption to
normal productive workflow: Measurement devices and systems
are in place, operator workflow and interface are optimized,
and data are collected without interrupting the operator's
primary job of running the process.
Is set up to store and retrieve data efficiently. The database
is organized to handle process data, application software
is in place to simplify access and retrieval of process
data, and data can be delivered in useful reports and charts
via intranet, Internet or other means to all who need it.
In a process-intelligent enterprise, process information
isn't only for the plant floor, lab or engineering department.
It also lends itself to sales, supply-chain management,
investor relations, regulatory compliance and any other
department that can make the enterprise more competitive
and productive. For example:
Sales uses process capability information to price products,
win contracts and conduct favorable contract negotiations.
Supply-chain management uses quality data both to prevent
and gain an early response to supply-chain incidents.
Investor relations uses process information to show analysts
how the enterprise prevents supply-chain incidents.
Regulatory compliance uses process information to generate
required reports.
Lab, engineering and plant management all use process data
for continuous process improvement and to ensure that products
are produced within specifications.
In all these situations, employees have easy access to
up-to-date, and often real-time, process information. In
each case, the information is tailored to the level of what
the person needs to know. For example, it's not reasonable
to expect salespeople to understand the intricacies of process
capability calculations, but if they have a general understanding
of Cpk and control charts, they should have access to data
in that format. Likewise, a senior manager doesn't need
real-time process data, but he or she does need process
information in the form of key performance indicators, similar
to the type of data delivered in typical business analytics
systems. And, of course, engineering and process control
people need it all: KPIs for a quick look, control charts
and other types of data graphics, and access to the actual
data as needed.
A number of obstacles can impede enterprisewide process
intelligence. These include:
Fear of exposure. For some plant operators and managers,
sharing process information is the business equivalent to
that nightmare of finding oneself stark naked in a crowded
public setting. The very idea of making a process available
to other departments, suppliers and--worst of all--customers
gives them heartburn.
"It would be impossible to share our process data
with nonprocess people," observes one plant manager
in the food-processing industry. "They'd get freaked
out over what looks like under-roasted product, when in
fact it just means we need to rerun it through the roaster,
which we do all the time. The phone would be ringing off
the wall."
A quality department can play a big--and in many cases
expanded--role in alleviating fear-based objections by ensuring
that those who will be looking at process data have enough
process literacy to understand what they're looking at.
Along with the actual data, process and quality education
should be spread throughout the enterprise.
It's also important for people to realize that sharing
process intelligence isn't a matter of "if" but
"when." And this sharing isn't restricted to people
in-house, either. Customers increasingly demand it, and
the sooner your organization figures out how to live with
that, the more competitive it will be.
In the semiconductor industry, for example, some companies
offer customers complete access to real-time process information
via Web-enabled technologies. Customers can view process
and quality data at several key production points, check
scrap rates and see where their order is on the production
line--all without intervention or interpretation by the
process owners. Contrary to the latter's expectations, phone
lines aren't jammed by hysterical customers. In fact, customers
who are more informed about the process are more likely
to be understanding and help to resolve process-related
problems.
Why are these companies willing to show all? Because it
gives them competitive advantage. Chances are your customers
are already beginning to think in these terms. Hold back
out of fear and they might just run right over you. That's
an argument that can convince anyone.
Management doesn't care. A process-intelligent enterprise
requires a corporate culture in which process improvement
is a well-established precept. Acting alone, the quality
department can't make this happen; it needs one or more
champions in management.
The key to gaining a management champion is proving return
on investment (i.e., demonstrating how people can use process
intelligence to improve the bottom line).
Continuous process improvement is still a good argument,
especially citing specific examples of how reducing scrap
and cycle time can add to the bottom line. However, there's
a lot more you could say. One manufacturing company gained
substantial leverage in negotiating contracts by teaching
its salespeople about process capability. Using control
charts and other tools, the sales team was able to show
that the company's manufacturing process was highly capable
of producing within the customer's specifications. The competition
either couldn't or wouldn't do this.
That same sales team was able to negotiate a very favorable
contract with a customer whose written specs were originally
outside the manufacturer's process capability. The team
explored the specs with the customer, and together they
discovered that the specs had been written off the cuff
by an engineer and weren't all that critical to the functioning
of the product. They negotiated new specs that worked for
both the customer and the manufacturer's process capability.
Another convincing ROI argument is how quality information
can help prevent supply-chain incidents. A recent study,
"What Is Supply Chain Management Worth?" by Vinod
Singahl and Kevin Hendricks, (IIE Solutions, February 2001)
shows that supply-chain incidents pose one of the greatest
threats to a company's stock price. If your supply-chain
manager uses quality and process information as an early-warning
system to ward off such incidents, improvement to the bottom
line as well as the stock price could potentially be huge.
We already have process intelligence. Many people in both
IT and management assume that because some enterprisewide
systems have quality or SPC modules, they therefore have
all the process intelligence they need.
The truth is, the larger the scope of the enterprisewide
system, the less process intelligence is probably built
into it. Frequently, these big systems have no direct connection
with the process. Rather, they depend on intermediate layers
and use derivative results.
Most of these systems can produce low-level charts, but
SPC and/or quality processes remain a secondary issue, usually
just a token effort to meet the checklist on a product brochure.
Remember that developers of these big systems take on a
huge design task. They almost never have deep or specific
expertise in quality and SPC, nor should they.
Recognizing this, some of the big-system vendors are partnering
with SPC software firms that have the specific expertise
to build a module that provides useful process information.
If process information in your enterprise will be spread
via one of these systems, make sure that the SPC module
is up to the job. Otherwise, the process information it
generates won't be useful enough to convince anyone to use
it.
Process intelligence is too hard for nonprocess people.
Nonsense. With minimal training, anyone can learn to read
a control chart. The real difficulty lies in choosing the
right data and chart to show those nonprocess employees
what they need to know.
That's where you come in.
The more you communicate process intelligence, the bigger
your burden to present the information at the right level
of complexity to those who use it. Simple KPIs may be fine
for some; others will need process capability information,
control charts, box plots and other tools.
The quality department is the logical place to make those
types of decisions and to ensure that the process data are
valid and verified. For most enterprises, this will be a
natural expansion of the quality department's responsibilities
and one that ties it directly to critical company decisions.
Specialized SPC software is too expensive and difficult
to implement. The fact is, specialized SPC software is available
at a fraction--less than a few percent--of the millions
of dollars most companies spend on IT for enterprise resource
planning and manufacturing execution systems. If you're
currently using Excel or some other solution that's not
SPC-specific for analyzing process information, management
might be persuaded to write the check for upgrading after
hearing the arguments in favor of enterprisewide intelligence.
Compare the cost of the software against the savings you
can achieve, the losses you can avoid or the sales you can
win with it. Convince and enlist your sales and supply-chain
people to help.
As far as implementation is concerned, SPC software packages
that connect easily with any standard database are available
and, without too much IT support, can be configured to send
process intelligence throughout the enterprise via corporate
intranet.
Keep in mind that your SPC software should be:
Easy to use and configure
Able to pull data from multiple databases
Equipped with easy-to-read and -compare graphics
Easy to install
Technically capable of providing useful process information
as needed throughout the enterprise
Yes, it is. Some companies--notably in the semiconductor,
automotive and aerospace industries--have faced and overcome
most of the challenges described in this article. These
companies share some common conditions:
They need to drive process intelligence throughout the organization
in order to survive. Process improvement and intelligence
are major factors in how well they compete in the marketplace.
Supply-chain management is so critical that quality-related
supply chain events pose a threat to the organization's
overall bottom line and/or stock price.
Upper management creates a corporate culture in which process
literacy and process improvement can thrive, and also creates
a strong "pull" for people at all levels to use
quality and process information.
They invest in the IT infrastructure needed to collect,
analyze and deliver process information to those who need
it. They're also willing to invest in the training needed
to help employees gain process literacy.
If your company shares these same conditions, it might
be time to consider establishing a process-intelligence
system throughout your enterprise. Don't hesitate to begin
with smaller goals to achieve this greater one. Make friends
with your salespeople. Start talking about what process
literacy can do for their contract negotiations. Educate
them and encourage them to talk to their managers. Build
a few success stories with proven ROIs and then continue
from there. Before long, you'll be walking through the cafeteria
and hearing words such as "Cpk," "capability"
and "control limits." Then you'll know you're
on your way to spreading process literacy.
Jeff Cawley is vice president of Northwest Analytical
Inc., which develops analytical software for understanding
processes and improving quality. NWA's suite of software
solutions for statistical process and quality control is
used in more than 4,500 corporate sites worldwide. Comments
about this article can be sent to letters@qualitydigest.com.
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