54428

December 2010
www.qualitymag.com
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Innovation with Integrity

Quality Quick Clicks 351 at qualitymag.com
CONTENTS DEPARTMENTS
4
DECEMBER 2010
VOLUME 2/NUMBER 12
From the Editor

Money Matters
6 Industry News
Consumer Reports’ Annual
Reliability Study
 Machine Vision Market
Continues Recovery
 Bruker Buys Veeco’s
Metrology Business
12 Face of Quality
Three Values for a
Quality Culture
14 Other Dimensions
Changing the Rules
16 Quality 101
Traceable to NIST Explained
18 Quality Innovations
30 Magnetic Particle Inspection
Gets a Break
FEATURES 32 Case Study

 Ground Up Pension
Improvements
20 Special Report: Gaining Ground
All indications are that 2011 will see a slow but steady increase in quality  Early Market Penetration
spending, according to the annual Quality Magazine spending survey. and Continuous
Improvement
24 Improve Organization Performance
36 Quality Products
Through Quality Auditing
Organizations need to shift from compliance to performance-based auditing. 38 Classifieds
39 Advertising Index
26 Preventive Maintenance for Your SPC
Is your SPC system performing at its peak condition or does
it have a common illness? NEXT MONTH
 Handheld Gaging
30 The Outsourcing of HR
While the manufacturing industry is well aware of the benefits outsourcing  Vibration Testing
can provide, few realize that these benefits can be applied to human  Leak Testing
resource management.  Medical Standards
ABOUT THE COVER

After a tumultuous couple of years, the quality industry is headed in the right direction and starting to gain ground, albeit slowly.
Art Director: James P. Hohner Jr.
www.qualitymag.com December 2010 | QUALITY GLOBAL EDITION 1

| O N L I N E TA B L E O F C O N T E N T S | D EC E M B E R 2010
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views on the latest in quality • NDT: Key to Quality and
and manufacturing: NDT Round-Up
• Jim’s Gems: Weekly Updates! • Learning with Lecky, Vision Round-
• Peter Sanderson’s Video Blogs Up and Perspectives in Vision
Podcasts are easy to listen to directly from your computer or Videos show you the latest products and technology
downloaded as an MP3 file. to improve manufacturing processes.
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Reflections on the World of Food Safety • Carl Zeiss
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2 QUALITY GLOBAL EDITION | December 2010 www.qualitymag.com

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F RO M T H E EDI TOR B Y GIL L IA N C A MP B E L L
Money Matters
H ave you heard the news? After a couple of
dismal years, quality spending is expected to
increase in 2011 to $2.6 billion, according to
not ship in a timely manner or help improve on-
time delivery.”
And it’s not just in terms of people where
Quality Magazine’s Annual Spending Survey. spending needs to be increased; one reader said he
Gillian Campbell is editor (Turn to pg. 22 to read the full article.) While it’s needs more money for quality inspection equip-
of Quality Magazine. a slow growth—about an 8% increase from this ment. While $2.1 billion is allocated for test, mea-
Gillian can be reached at year’s numbers—it is a step in the right direction. surement and inspection equipment, that’s clearly
campbellg@bnpmedia.com. As was the case for 2010 spending, the principal not enough for many companies.
motive behind quality investments in the upcom- Industry standards are cause for concern and
ing year is to improve productivity, according to another area where a few readers suggested more
60% of the respondents. Clearly the industry will money needs to be thrown. Forty-two percent
continue to do more work with smaller staffs. of survey respondents indicated that one of the
For a majority of the companies (52%) spending primary motives behind quality investments is to
on quality equipment, systems, software and ser- adhere to tighter part quality standards. This is
vices will remain the same in the upcoming year. an increase of 9% from just a year ago and a 12%
For another 36%, spending will increase, and 12% increase from four years ago.
of respondents will see a decrease. ‘Tis the holiday season and the season of giving.
While companies are out to make a profit, there Where would you like to see management increase
are a few areas where management needs to take a spending in the upcoming year? Send along your
closer look at spending—or lack thereof. wish list to campbellg@bnpmedia.com, or share
“One area where spending is not increasing is with other members of the Quality community
in the quality assurance inspection of product,” at the Quality Magazine LinkedIn Group page at
says William H. Murray Jr., quality assurance http://www.linkedin.com/groups?gid=1876808,
manager at Bauer Compressors Inc. (Norfolk, the Quality Facebook page at http://www.face-
VA). “Although the workload has increased and book.com/#!/QualityMagazine?ref=sgm and on
more product is being processed, the need to Twitter at http://twitter.com/QualityMagazine.
increase staff to meet this demand is not con-
We’ve introduced mobile tagging sidered. Currently staffing is increasing in the
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Quality. Get the free app for your yet, but when it does, the training cycle will still
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GLOBAL EDITION
INDUSTRYNEWS
| Business News | Coming Events | People News | Mergers |
COMING EVENTS CONSUMER REPORTS’ ANNUAL Still, GM made the most progress of
RELIABILITY SURVEY: GM MAKES the three domestic manufacturers in
JANUARY BIG STRIDES WHILE HONDA, this survey. Across GM brands, 69% of
19-21 AIA CONFERENCE,
TOYOTA DOMINATE models had average or better reliabil-
YONKERS, NY—In Consumer Reports’ ity. Cadillac improved the most, rising
Orlando, FL,
2010 Annual Auto Survey, the latest seven places from last year’s ranking.
Automated Imaging Association
predicted-reliability ratings of new cars In the survey, based on 1.3 million
(407) 898-7006
finds that General Motors has improved vehicles, 90% of Fords—including
www.machinevisiononline.org
considerably, though Honda and Toyota Lincoln models—have at least average
17-20 SIX SIGMA SUMMIT still dominate the auto market. Eighty- reliability. As a brand, Ford now out-
Orlando, FL, three percent of Chevrolets—GM’s ranks Mazda and Nissan and ranks just
IQPC major brand—now have average or bet- below Lexus. Its quality renaissance has
(800) 652-2363, ter scores in predicted reliability. That’s been led by the Fusion, a design that
www.leansixsigmasummit.com up from 50% last year. has been very reliable since its debut
While some GM nameplates had five years ago. Ford vehicles are tops for
FEBRUARY been among the least reliable brands in reliability in two categories: family cars
past years, they now rank above some (Fusion Hybrid) and large SUVs (Ford
8-10 MD&M WEST, major European competitors, such as Flex EcoBoost).
Anaheim, CA, Audi, BMW and Mercedes-Benz. Chrysler Corp. has not shared in the
Canon Trade Shows, Two factors are aiding GM’s reli- success of the other Detroit manufac-
www.canontradeshows.com/ ability improvements. First, GM’s turers. The Chrysler, Dodge and Jeep
recent introductions, such as the brands are saddled with dated models.
28–3/1 2011 LEAN AND SIX SIGMA Chevrolet Camaro and Equinox, Buick Twelve of the 20 models for which Con-
CONFERENCE, LaCrosse V6 and Cadillac SRX are sumer Reports had sufficient informa-
Phoenix, AZ, proving reliable from the time they tion rate below average in reliability.
(800) 248-1946 were launched. In addition, GM shed None of Chrysler Corp.’s models score
sixsigma.asq.org many models with subpar reliability above average. With Fiat’s acquisition
when it shut down the Saturn, Pontiac of Chrysler, many of its products will
APRIL and Hummer brands. Even some older either be replaced or redesigned in the
models, such as the Chevrolet Ava- near future.
11-13 QUALITY CONFERENCE
lanche, Corvette and Suburban have
Charlotte, NC,
improved to average. Asia Still Dominates
Quality Magazine
As a company, GM is still a ways Despite recent safety recalls, Toyota
(888) 530-6714,
from the top when it comes to reli- models—including those from Scion
www.qualitymagconference.com
ability. The major Asian automakers— and Lexus—remained among the most
5-7 AERO DEF including Honda and Toyota—are still reliable and earned top scores in five
Anaheim, CA, out in front. Among the three domes- vehicle categories: small cars (Yaris),
SME tics, Ford continues to build the most midsized SUVs (FJ Cruiser), luxury
(800)733.3976 reliable vehicles. Chrysler lags behind SUVs (Lexus LX), minivans (Sienna V6,
aerodef.sme.org both GM and Ford. FWD) and full-size pickups (Tundra
MAY
View the latest in quality industry news by visiting
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Boston, MA, Just click the tag now and see what you’re missing.
Society of Plastics Engineers If you don’t have the mobile app on your smart
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www.antec.ws

V6). Only the all-wheel-drive Lexus GS including cameras, lighting, optics,
and the new Lexus IS 250 convertible ASSOCIATION NEWS imaging boards, software, application-
rank below average. The redesigned 2010 The Polyurethane Manufac- specific machine vision systems and
Toyota Prius, hurt by antilock brake turers Association (Milwaukee, smart cameras.
problems on early vehicles, scored only WI) has announced its second AIA noted that 65% of companies
average, a drop from previous years. annual student scholarship com- participating in the report expect sales
Honda and Acura are among the top petition. The program, which to improve in the second half of 2010
four brands—along with Porsche and promotes education in cast over second quarter 2010 results. Thir-
Scion—with models topping five vehi- polyurethane engineering and ty percent anticipate sales at or near the
cle categories. These are upscale cars product design, aims to ensure level reached in the second quarter, and
(Acura TL, FWD), luxury cars (Acura that processors and suppliers just 5% believe that sales will decrease
RL), small SUVs (CR-V), upscale com- have access to a consistent in the second half of the year.
pact SUVs (Acura RDX) and compact pool of trained and experienced “These results clearly show that
pickups (Ridgeline). Problems with rear engineers. It will award a $4,000 machine vision companies have suc-
brake pads help drop the 4-cylinder scholarship to the contestant ceeded in extending the recovery
Accord and Acura TSX to average. who exhibits the best plan, through the second quarter of 2010,”
Hyundai and Kia continued to do design and sample product using says Paul Kellett, AIA’s director of mar-
well, with only one model, the Kia cast polyurethane to replace a ket analysis. “If industry expectations
Sedona minivan, rated below average. part traditionally made of plastic, are correct, the recovery should extend
All six new models for 2010 (Hyundai rubber or metal. For more infor- even further with solid growth in the
Genesis Coupe, Sonata, Tucson, Kia mation, visit www.pmahome.org/ second half of the year.”
Forte, Sorento and Soul) had average or Scholarship.aspx.
better reliability, which was an impres- BRUKER BUYS VEECO’S
sive first-year showing. METROLOGY SEGMENT
Nissan’s mainstream models scored redesigned E350 sedan was above aver- FOR $229M
well. The Altima and Maxima sedans age. The new E-Class coupe, a wholly PLAINVIEW, NY—Veeco Corp. final-
and the Murano and Pathfinder SUVs different car from the E-Class sedan, ized the sale of its atomic force micros-
all rated average or better in pre- languished in the bottom ranks. copy and optical industrial metrology
dicted reliability. The Titan had shown Nearly three-quarters of the Audi instruments businesses—including
improvement in the past year or two, but models Consumer Reports analyzed its Goleta, area facility—to Billerica,
both 2WD and 4WD versions have once were below average. The A6 with the MA-based Bruker Corp. The company
again dropped to below average reliabil- new supercharged 3.0-liter V6 was paid $229.4 million in cash in the deal,
ity. The small Nissan Cube had a below tied with the Jaguar XF for the worst which was announced in August.
average score in its first appearance in new car prediction score. Volkswagen The Goleta facility was once Digital
the Consumer Reports survey. The Infin- did better, with its Golf receiving very Instruments, which Veeco purchased
iti models were all average or better. positive ratings and the various Jetta in 1998. More than 350 employees will
Subaru had a good record overall, with models scoring average or better. join Bruker AXS Group’s Bruker Nano
a top rating going to the four-cylinder The Porsche Boxster has the best Division. Mark Munch, Veeco’s execu-
Legacy sedan and the non-turbo version predicted reliability score in Consumer tive vice president of its metrology and
of the Forester SUV. The WRX was the Reports survey, while the Audi A6 3.0T instruments, will be the president of
only model that rated below average. and Jaguar XF have the worst. Bruker Nano Inc.
Bruker develops and manufactures
Europe’s Bumpy Road MACHINE VISION MARKET X-ray technologies, magnetic reso-
While European carmakers’ reliability CONTINUES SOLID RECOVERY IN nance technologies, mass spectrom-
had been improving, momentum seems NORTH AMERICA etry technologies, optical emission
to have stalled. All Porsche and Volvo ANN ARBOR, MI—Sales of machine spectroscopy and more for the life
models are rated average or better. But vision components and systems in science, pharmaceutical, biotechnol-
Audi, BMW and Mercedes-Benz are North America jumped 60% in the sec- ogy and molecular diagnostics indus-
among the worst automakers overall in ond quarter of 2010 compared to the tries. Veeco Instruments makes solar
terms of reliability, the report indicates. same period in 2009, according to new panels, LEDs, hard drives and other
BMW had a bad year, with five of its statistics from the Automated Imaging hardware devices.
11 models scoring below average. While Association (AIA).
the BMW M3 topped the sporty cars cat- Second quarter sales were also up SUPPLY CHAIN EFFICIENCY KEY
egory, the 1-, 3- and 5-Series models with 20% over the first quarter of 2010, FACTOR FOR MANUFACTURING
the 3.0-liter turbocharged (N54) engine indicating an acceleration in this year’s PROFITS DURING RECESSION
had high problem rates related to the fuel market recovery. FALLS CHURCH, VA—The eighth
system, among other complaints. The new report, titled Quarterly annual Global Survey of Supply Chain
Six of Mercedes-Benz’s 13 models Machine Vision Sales Tracking Report, Progress indicates that businesses rely
were below average, and the GLK SUV shows sales were robust in all major on supply chain operations amid eco-
was far below average. However, the machine vision supplier markets, nomic turmoil.

| IND U ST RY N EW S |
The 2010 survey was conducted in reducing costs and sustaining rev- • Combined with other responses,
by CSC, Supply Chain Management enues and customer satisfaction across these results suggest that most firms
Review, The Eli Broad Graduate School the organization. are at the bottom of the economic
of Management at Michigan State Key findings include: trough and will use their supply
University, with assistance from The • An efficient supply chain was essen- chains to keep a lid on costs as they
Council of Supply Chain Management tial to maintaining prices on goods slowly rise out of the downturn.
Professionals (CSCMP) and Supply and services over the past year and • Firms reporting no increases in
Chain Europe magazine. also was the means to generating sales or those who were not able
Completed by supply chain execu- new revenues. to find fiscal increases rose from
tives from 20 different industries • When asked what happened to the 30% in 2009 to 47% in 2010. This
worldwide, the survey questioned emphasis on supply chain manage- indicates that a down economy took
respondents about business results ment in the last 12 to 24 months, its toll on what had been consistent
during the economic downturn, 78% reported it had increased. improvements in both areas—costs
focusing specifically on how sup- • Savings achieved in 2010 were essen- and revenues.
ply chain initiatives—and supply tially flat or fell off slightly when • Results show that leaders took
chains in general—had played a role compared to 2009. advantage of the times to build
BUSINESS NEWS
Apollo Associated Services (Midland, MI) has added Cirtronics Corp. (Milford, NH) a manufacturer spe-
a new office in The Republic of Cyprus. With offices in cializing in medical, defense and high-tech contract
Asia, Australia, Canada, Europe, Scandinavia, South manufacturing, has received national recertification as a
America and the United States, this extends Apollo’s Women’s Business Enterprise by the Women’s Business
global reach and increases its localized presence. Enterprise National Council (WBENC).
JJS Electronics (United Kingdom) recently celebrated 3D Systems Corp. has acquired Provel, S.r.l. (Turin,
AS 9100 registration, having been awarded the industry Italy) a provider of rapid prototyping, tooling and manu-
standard for its manufacturing sites in Lutterworth, UK, facturing services, as part of the company’s continued
and Chomutov, Czech Republic. The certification repre- expansion of its 3-D proparts service in Europe. Provel
sents the recognition of excellence in business, quality delivers rapid prototyping, tooling and manufacturing
management and operational practice. services to Italian automotive and durable goods manu-
facturers specializing in stereolithography, selective laser
Applied Industrial Technologies (Cleveland, OH) has
sintering, rapid tooling and urethane casting.
been named a NorthCoast 99 award winner for 2010. In
business since 1999, this is the tenth time Applied has Sensors Inc. (Saline, MI), a manufacturer of in-use
received the annual award that honors 99 workplaces for emissions test equipment, and Froude Hofmann (Detroit,
top talent in northeast Ohio. Applied was designated a MI), an international company specializing in the design
Legacy Award winner due to its record. and manufacture of test cell equipment, have formed a
strategic partnership. The partnership combines Sensors’
Magnetic components and assemblies manufacturer
portable emissions measurement systems with Froude
Industrial Magnetics Inc. (Boyne City, MI) will be cel-
Hofmann’s dynamometer and control systems, enabling
ebrating its 50 year anniversary in 2011. The company
a low-cost standalone or integrated emissions measure-
attributes its long-term success to its mission of provid-
ment solution for test cell applications.
ing customers with creative solutions and products for
mutual success and providing the right product at the Quality Vision International Inc. (QVI, Rochester,
right time for the application and excellent service during NY), recently completed a move to Tempe, AZ. The
all phases of the project. 12,500-square-foot technical center houses the sales
and service operations of Optical Gaging Products, View
MAG (Erlanger, KY), a manu-
Micro-Metrology and the Quality Vision Services divisions
facturing technology company,
of QVI. The new facility is designed to provide sales and
has acquired the gear hobbing
applications support, service, and training for the com-
and chamfering/deburring
pany’s customers in the western United States, Mexico
product line of Samputensili
and western Canada.
GmbH (Chemnitz, Germany)
as part of a broader alliance Dexela (London, England) collected the Judges’ Special
between the two companies. Award at the British Engineering Excellence Awards
MAG has aquired Samputensili The acquired company will be (BEEA) and received a special commendation in the
GmbH’s gear hobbing line. renamed MAG Modul Verzahn- Small Company of the Year category. The awards aim
technik, GmbH. This business to demonstrate and promote the quality of engineering
will include the gear-cutting portfolio, as well as the func- design within the UK. The BEEA judges agreed that Dex-
tionality, services and know-how for hobbing. ela’s technological and commercial success was com-
mendable in view of the company’s size.

market share. When asked if the
downturn had resulted in changes to PEOPLE NEWS
market share, 37.5% said their shares Carl Lider has been named general manager of Wisconsin operations at Dick-
had gone up, while 22.5% said they ten Masch Plastics (Nashota, WI), a custom thermoplastics and thermoset
went down. molder. Lider, a Six Sigma black belt, lean facilitator and value stream leader
and trainer, has worked at DMP for more than 12 years, most recently as plant
NIST AWARDS $9.1 MILLION TO manager in Wisconsin.
ENHANCE U.S. MANUFACTURERS’
GLOBAL COMPETITIVENESS Dean Roberts has been made a president of the Americas After-
GAITHERSBURG, MD—The National market Services of Milacron LLC (Batavia, OH), a global manufacturer
Institute of Standards and Technol- of processing technologies. Roberts brings more than 28 years of
ogy (NIST) Manufacturing Extension experience in manufacturing to the newly created role. Roberts will be
Partnership (MEP) announced $9.1 responsible for enhancing the value of Milacron’s aftermarket services
million in cooperative agreements for to customers through its ServTek, Wear Technology and Progress Preci-
22 projects designed to enhance the sion businesses.
Dean Roberts
productivity, technological perfor-
Bill Miller, a 23-year quality control management veteran, has been
mance and global competitiveness of
named quality assurance manager at Gasco Affiliates LLC (Oldsmar, FL), a glob-
U.S. manufacturers.
al producer of precision calibration gas. In his new position, Miller will be respon-
Granted through competitive pro-
sible for overseeing operations, production methods and processes, training all
cesses to nonprofit organizations, these
personnel to ensure commitment to quality, enhancing Gasco’s reputation for
projects will be implemented through
quality management, as well as establishing and implementing the company’s
MEP’s national system of more than
ISO quality management system.
400 centers, field offices and partners.
The funding will help encourage the Jeff Gust has been named chief corporate metrologist at Fluke Corp.
creation and adoption of improved (Everett, WA), a global electronic test and measurement technology
technologies and provide resources to company. Gust will oversee the Fluke primary metrology laboratories in
develop new products that respond to Everett, WA; American Fork, UT; Phoenix, AZ; and Houston, TX, and will
changing market needs. drive initiatives to unify and standardize metrology policies and prac-
“A vibrant manufacturing sector tices across Fluke sites and measurement parameters.
drives American innovation and is cen-
Donald O. Nicholson joins Specialized Technology Resources Inc.’s Jeff Gust
tral to our economic growth and global
(Enfield, CT) quality assurance division as director of North American
competitiveness,” says U.S. Commerce
sales. Before joining STR, Nicholson was vice president of sales at Intertek Test-
Secretary Gary Locke. “With the right
ing Services, where he oversaw a team of more than 100 sales and business
investments, we can continue to cre-
line management professionals. Nicholson holds a degree in electrical engineer-
ate highly-valued manufacturing jobs
ing technologies from the State University of New York at Alfred.
building great products and sell them
around the world.” Avishai Kepten has been appointed vice president and general manager of
The proposals selected represent a Rudolph Technologies Inc.’s (Flanders, NJ) metrology business unit. Kepten
variety of compelling ideas for helping brings more than 25 years of experience in the semiconductor and solar indus-
small- and medium-sized U.S. manu- tries to the role.
facturers tackle a complex set of needs
Ford Motor Co. (Dearborn, MI) announced the retirements of two company officers
with cost-effective and innovative solu-
as well as a series of executive appointments that will further strengthen Ford’s
tions. The projects address one or more
global management team in support of the company’s One Ford plan.
of five areas MEP has identified as vital
In addition to these changes, Ford is announcing several key executive appoint-
for strategic growth in U.S. manufac-
ments in its global product development organization, effective Jan. 1, 2011.
turing. These areas include:
• Gerhard Schmidt, chief technical officer and vice president of research and
• Responding to evolving supply
advanced engineering, will retire Feb. 1, 2011.
chains.
• Paul Mascarenas, currently vice president of engineering, is appointed chief
• Accelerating the adoption of new
technical officer and vice president of research and advanced engineering,
technology to build business growth.
replacing Schmidt.
• Implementing environmentally sus-
• Ingvar Sviggum, vice president of marketing, sales and service in Ford of
tainable processes.
Europe, will retire. He will be succeeded by Roelant de Waard, vice president
• Establishing and enabling strong
of sales at Ford of Europe, who is elected an officer of the company.
workforces for the future.
• Barb Samardzich, vice president of powertrain engineering, is appointed vice
• Encouraging cultures of continuous
president of global product programs.
improvement.
• Joe Bakaj, vice president of global product programs and product develop-
ment at Ford of Europe, is appointed vice president of powertrain engineering.
• Raj Nair, vice president of operations in the Asia Pacific and Africa, is elected
an officer of the company and appointed vice president of engineering.

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site at www.stindustries.com

FAC E OF QUALI T Y B Y J IM L . SMI T H
Three Values for a

Quality Culture
A quality culture is led by managers who believe their company exists to create a
mutually beneficial relationship between itself, its employees and its customers.
Jim L. Smith has more than

45 years of industry experience
in operations, engineering,
W hat is culture? Culture is the shared beliefs,
values, attitudes and behavior patterns
that characterize the members of a family, a com-
ner. An organization with integrity at its core
believes in a high-trust environment, honoring
commitments, an absence of noxious politics,
research & development and munity or an organization. In a healthy business true teamwork and an open exchange of ideas.
quality management. culture, what is good for the company and its cus- • Customer focus. Anyone working in the business
You can reach Jim at tomers come together to become the driving force world is torn repeatedly by having to make difficult
faceofquality@qualitymag.com. behind how everyone behaves. choices. We’re not talking about technical decisions.
A quality culture begins with managers and We are talking about judgment calls such as, “Do we
leaders who believe in the necessity of serving cus- ship the product today or work on it to get it right?”
tomers in order for their organizations to succeed. Doing the right thing for the customer may
The result of that understanding is sometimes cause internal organizational pain. If
a culture where a positive internal you don’t do that, however, then all you’re doing
Strong quality cultures begin environment and the creation of is deferring the pain to a later date and it will be
delighted customers go together. more expensive. In addition, failure to do the
with core cultural values. A great strength of total qual- right thing has a lasting negative effect, not only
ity management (TQM) is that it on customers, but for employees as well.
shows that growth, profitability, customer satisfac- Customer focus has many cultural manifesta-
tion and a healthy environment are not mutually tions: a drive to release products on time, a pas-
exclusive. In fact, they are mutually supportive sion for creativity and quality, and products that
and necessary to succeed over the long haul. are genuinely fit for use. However, it all starts
Strong quality cultures begin with core cultural with having the courage to ask the question
values. Behavior is the direct result of a person’s first, “What is best for the customer?”
values and assumptions. If we know what your • People. No matter the size of the business,
values are, we can better understand what you are people are an organization’s number one asset.
likely to do in various situations. Our people play critical roles in the success of
What are values? Essentially, they are our basic the organization. Organizations are the collec-
beliefs about what is right, good, correct, desirable tive sum of their people and their output, such
and moral. We can think of values as a mental tool- as products and services.
kit we use to understand how to relate to various cir- Employees should be seen as assets, not expens-
cumstances and decide what action to take. All of us es. Assets are something to invest in. Organiza-
behave in ways that are consistent with our values. tions with a strong quality culture invest heavily
In an organization employees will behave in in all their assets, including their people. They
ways that are consistent with the core values of the invest in upgrading the skills and knowledge of
culture. Who establishes these core values? Every- their number one asset. Leaders institutionalize
one has a role, but managers and leaders are the ways in which to recognize and reward positive
ones responsible for establishing those values. behaviors they want to reinforce. In turn, employ-
In defining a set of desirable values for a corpo- ees in a positive quality environment become
rate culture, we choose values not for their relative more engaged, productive, receptive to change
popularity, but rather for their utility in describ- and motivated to succeed. Everyone wins.
ing an organization that is worth working for. The
list of core values has only three items—integrity, Leaders must be willing to accept that a quality
customer focus and people. culture is critical to their survival. They must step
• Integrity. The cornerstone of all that is honor- forward to demonstrate their commitment to that
able, integrity is a value that requires us, in quality. All employees must nurture that environ-
all our relationships, to conduct ourselves in ment and share ownership of the culture of qual-
an honest, truthful and straightforward man- ity. We are all in this together.

Use the
TARGETED
SELECTION GUIDES
to Find…
Loaded with detailed information

you can use to find a supplier!
OTHE R DI MENSI ONS B Y H IL L C OX
Changing the Rules

Cal labs provide a bunch of numbers. What is done with those numbers
is up to the customer.
Hill Cox is president of

Frank J. Cox Sales Ltd.
(Brampton, Ontario, Canada).
M ost of the world seems to function quite well
using ISO 17025 as a standard for calibra-
tion laboratories. Unfortunately, some people are
is becoming increasingly fed up with its numbers
decorating reports, often implying something that
doesn’t exist. A properly accredited ISO 17025 lab
He may be reached at not content with this and have to get their finger- cannot be accredited without the actual docu-
askquality@bnpmedia.com. prints all over it with interpretations or special ments being checked. The standard makes it clear
requirements to get it to suit their industry. The that reports do not have to show these numbers.
fact that similar industries around the world don’t • Compliance statements. The lab is asked to state
feel the need to do so just doesn’t seem to register. whether the item calibrated meets certain crite-
To make matters worse, the basic functions of a ria, some of which may be values from the cus-
calibration laboratory don’t seem to be understood tomer rather than a published standard. If the lab
by many who want to download processes and condi- has provided the data and the customer knows
tions on them. Often these additional requirements the criteria, why is the lab’s opinion required?
are attempts to make up for lack of • Acceptance criteria. Labs are frequently asked to
knowledge by users of the reports. provide acceptance criteria when that informa-
…the basic functions of a For the record, I should explain tion is more reliably provided by the customer
my understanding of what a cali- who knows how the equipment will be used. Too
calibration laboratory don’t seem bration laboratory is all about— often numbers are lifted from published standards
to be understood by many… without getting too technical, of
course. Basically, it is a place where •
whose numbers are for new, not used, items.
Re-cal dates. This type of information may be
you send your stuff to get calibrat- requested so the report reader can see when the
ed and they issue a report with their measurements equipment used to do the calibration is due for cal-
and a qualifier as to how good they think those ibration. I’m not sure what benefit will be derived
measurements are—the uncertainty statement. from this information without knowing a lot more
That’s it. Their service provides you with a about the equipment and conditions of use.
whole bunch of numbers. Sorry about that techni- Other requests in this regard relate to having
cal term there. What is done with those numbers the report show when the item that has been
is up to the customer. Now, if you want some sort calibrated should be calibrated again. Because
of analysis, quality processes done with the data or the standard forbids labs from doing so unless
reverse engineering, most labs will be pleased to the customer has advised the frequency, the
accommodate you for an additional fee. whole process seems redundant.
But all too often, everyone expects this addi- • Equipment used. To comply with this request,
tional service to be included in the calibration cost. the lab is supposed to list the principal equip-
It is not uncommon for the $50 calibration job ment used for the calibration. The brevity of
to consume $200 worth of consulting, teaching, such listings often makes them useless. For
training, analyzing, reviewing and making deci- example, for thread gage pitch diameter it might
sions the customer alone should be making. show “bench mike and wires.” I don’t know
On a less dramatic scale, many requests that cal about you, but such a listing would not prove to
labs deal with are of little value to anyone so they me that they had the right hardware.
can be just as problematic. In some cases these
gems are written into a version of ISO 17025 or are Massaging the data from the calibration report
requested because an auditor says they should be to make decisions has some of my colleagues
on a report. Here are some examples: concerned. Why? It looks like the customer is
• Traceability numbers. Usually they want to see a downloading decision-making to the lab to avoid
NIST number, which on its own means nothing responsibility. When the wheels fall off, all fingers
and may not directly relate to anything in the lab will point to the lab that said the gage was “good.”
issuing the report. Word on the street is that NIST As can be expected, only the lawyers will win.

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Visit www.qualitymag.com
Q UAL I T Y 101
Source: Starrett
System of Units (SI) or other

specified references. The measurement
system by which values and uncertain-
ties are transferred must be clearly
understood and under control.
The VIM definition states that met-
rological traceability is a property of
a measurement results by which that
result is related to specified reference
standards, not to institutions. Accord-
ingly, the phrase “traceable to NIST,”
in its most proper sense, is shorthand
for metrologically traceable to NIST’s
practical realization of the definition of
a measurement unit.
REFERENCING THE NIST NUMBER

Many imported gage certificates will
state that equipment used for inspec-
tion is directly traceable to NIST and
then a NIST test number will follow.
Having a NIST test number is only a
reference number for tracking internal
documents at NIST. But how does one
Traceable to NIST:
know its specific application?
• Again, the NIST definition for test
numbers helps explain.
“Test report numbers issued by
Explained
The term NIST traceable is deciphered. BY RICH RHONEY
NIST are intended to be used solely
for administrative purposes,” NIST
says. “Although they are often used
to uniquely identify documents
which bear evidence of traceability,
test report numbers themselves do
not address the issue and should
not be used nor required as the
M any gage calibration and repair

facilities often find themselves
discussing the topic of National
in the International Vocabulary of
Metrology (VIM) as “property of a
measurement result whereby the result
sole proof of traceability.”
• When reading that statement, one
should contact the manufacturer of
Institute of Standards and Technology can be related to a reference through a the gage he is using and ask what
(NIST) traceability with customers documented unbroken chain of cali- instruments or measurements the
going though ISO audits. Confirming brations, each contributing to the mea- manufacturer is referring to.
or tracking NIST gage traceability surement uncertainty.” As the operator of that instru-
are concepts with which more ISO ment, one must provide proof
accredited manufacturers should IDENTIFYING TRACEABILITY of an unbroken chain of trace-
familiarize themselves. It is important to note that traceabil- ability if an ISO auditor asks for
Most manufacturers have seen the ity is the property of the result of a that information, and an ISO/IEC
statements on calibration certificates measurement, not of an instrument or 17025: 2005 accredited laboratory
that read, “All measurements are trace- calibration report or laboratory. It is not is required to prove that its pro-
able to NIST,” when they purchase a achieved by following any one particular cesses and procedures are traceable
micrometer, caliper or gage block set. procedure or using special equipment. to NIST. The above procedures
But many of them still question what Merely having an instrument cali- make that possible.
the word traceable really means. brated, even by NIST, is not enough to
The definition of traceability that make the measurement result obtained Rich Rhoney is general manager at Gage
has achieved global acceptance in the from that instrument traceable to real- Services Inc. (Novi, MI). For more information,
metrology community is contained izations of the appropriate International visit www.gageservices.com.

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Q UA L I T Y I NNOVAT I ONS
the transducer pickup is a resistive cur-

Magnetic Particle rent shunt, which provokes a voltage
across this resistance as a function of
Inspection
the current passed through, and this
voltage is prone to noisy circumstances
and erratic triggering as this shunt
is not electrically isolated from the
customer’s magnetic power supply. By
Gets a Break using a resistive shunt for triggering,
the operator is not really measuring the
magnetic pulse, but instead the current
Digital instrument allows for inspection with maximum
that produces the magnetic pulse. This
sensitivity. BY KA RI O’ROURK E , M A NAGI NG EDI TOR is another example of how an error in
time measurement of the pulse dura-
tion can occur.
Q uick break detection dates back

to the 1950s and is a fast test that
confirms function status of “quick
particle inspection units, machine
operators had to use testers with flash-
ing neon bulbs or light emitting diodes
However, there is now a portable,
battery-operated digital tester that is
capable of providing quantitative indi-
break” circuitry in three phase full- (LEDs) as indicators. This allowed cation of quick break quality and shot
wave direct current (FWDC) mag- only for a qualitative indication (such duration time and is NIST traceable.
netic particle units. Alterations in the as how bright did the bulb flash?) of The Dyna-Sense QB-1/QB2 quick
performance of the electrical system quick break quality and the accuracy break detector from Scientific Instru-
of a nondestructive magnetic particle was debatable (such as did the bulb ments (Skokie, IL) uses a microcon-
inspection unit can have an effect on flash or not?). troller to analyze the magnetic pulse
the sensitivity of an inspection. This method of quick break detec- waveform determining quick break
To increase the sensitivity, it is tion has a change in sensitivity when quality and the magnetic shot duration
important to have quick break when exposed to light or handled in the simultaneously.
using these units. Therefore, the dark because of a change in the neon “The QB-1/QB-2 Quick break detec-
electrical system must be checked bulb firing voltage when exposed to tor and shot timer is the new industry
when the equipment is new, when a light. In addition, the firing voltage standard based on the original mili-
malfunction is suspected or every six could vary from one bulb to the next, tary specifications that defined quick
months, according to the ASTM stan- which could result in unreliable pass/ break,” says Greg Falk, engineering
dard E-1444-01. fail indications. manager at Scientific Instruments.
Until recently, in order to check the Previous methods for magnetic Unique features of the unit include a
quick break and shot time for magnetic pulse duration were limited because LCD digital readout that quantitatively
SPECIFICATIONS
 Accuracy of voltage indication as  Accuracy of shot time indication (on  The transducer coil on the probe is
measured through direct injection QB-2 model only) is 1% of reading, precision wound with very accurate
of DC voltage source at transducer ±2 counts on display least significant inductance and DC resistance. Never
input jack is 1% of reading, ±2 counts digit. Resolution is 0.01 second. try to use any other type of probe
on display least significant digit. Timing range is 0.40 to than the one provided with the
Resolution is 0.1 volt. 2.8 seconds. QB-1/QB-2/QB3 tester.
18 QUALITY GLOBAL EDITION| December 2010 www.qualitymag.com

The portable, battery-operated digital
tester is capable of providing quantita-
tive indication of quick break quality and
shot duration time and is NIST trace-
able. Source: Scientific Instruments
shows peak quick break voltage facili-

tating detection of existing degradation
of quick break in magnetic unit. This
Call Sunny Coverly at (610) 932-8350, or FAX: (248) 283-6587
allows for recording of quick break
Micro•Vu
voltage where the operator can track
the trend of quick break status and
measures up to 29 volts.
Shot time detection reads up to 2.8
seconds with 10 milliseconds resolu-
tion on the display. The precision
Precision Measurement Systems
reference air coil transducer gives reli- 13 New Machine Models
able, repeatable indications of quick
break intensity. It is manufactured NEW
under controlled conditions, looking NEW
for accuracy of inductance, turns and
DC resistance.
The tester operates on a 9-volt
lithium battery with an approxi-
mate time span of 45 hours. If using
an alkaline battery, the lifespan
is reduced to around 12 hours of
continuous use. Other advantages
include a magnetic pickup probe that
eliminates electrical noise pick up Vertex 251 Excel 501
and provides reliable magnetic pulse 250x160x160 mm 500x400x160 mm
duration (shot time) measurements. Automated 3D Automated 3D
Starting at $32,000 Starting at $43,000
According to Falk, the idea came
about because they were searching for a
better way to detect quick break with a Systems Include NEW
method that would provide a quantiti- InSpec
tative indication that is NIST traceable. Metrology Software
The product was in development for
Advanced Vision Tools
one year, which included field testing.
Programmable Lighting
Currently there are three models. Programmable Zoom
The QB1 is just the break tester. The Automated Reporting
QB2 offers the quick break tester and Free Updates
shot timer for three phase direct cur- NEW Excel 1001 1000x1000 mm Sol 161
rent inspection units. The QB3 includes NEW Excel 1601 1600x1000 mm 160x160x160 mm
the universal shot duration timer for NEW Excel 1651 1650x1250 mm Manual 3D, Auto Zoom
both AC and DC inspection units. 160, 250, and 400 mm Z available Starting at $12,000
For more information, contact:

Scientific Instruments
8236 North McCormick Blvd.
Skokie, IL 60076
(847) 679-1242
Vision Touch Laser
www.magretrofit.com
Micro-Vu Corporation
7909 Conde Lane
Windsor CA 95492
Established 1959 1-707-838-6272
www.microvu.com sales@microvu.com

| S P EC I A L R E P O R T |
Gaining
Ground
All indications are that 2011 will see a slow but steady
A fter a tumultuous couple of years,
the quality industry is headed in
the right direction and starting to gain
increase in quality spending. B Y G I L L I AN C AMPB E L L , E D I TO R
ground, albeit slowly.
Respondents to Quality Magazine’s with 36% of respondents saying that getting new product to market is no
11th Annual Spending Study estimate cuts will be more than 25% of the longer at the top of the priority list.
the quality marketplace to be $2.57 bil- previous year’s budgets. While spending grows slowly,
lion in the upcoming year. This equates Faced with the new normal, manu- quality remains a priority for today’s
to an average of $66,487 per plant, facturers will continue to do more manufacturers. When compared to
nearly a 19% increase per plant vs. a work with less in 2011. The number three years ago, 29% said quality is
year ago. one motive behind quality investments of highest importance and they are
When asked how their plants’ is improving productivity, according to aggressively pursuing top quality
projected spending for quality assur- 60% of respondents. This is followed performance. Another 44% said qual-
ance and control equipment, systems, by reducing scrap and rework, 55%; ity has increased importance, and
software and services in 2011 com- reducing costs, 50%; increasing pro- 23% indicated it has the same level of
pares to 2010, 52% claim that they’re duction capacity and tighter part qual- importance. Only 4% said quality is
holding the line on budgets, while ity standards, both at 42%. less important today than it was three
another 36% will increase quality In the past nearly one of the years ago.
budgets in the upcoming year. Only principal motives behind quality
12% of respondents expect a decrease investments—to ramp-up for new PROJECTED VS. REALITY
in budgets in the upcoming year, and products—hovered near 50%, but Taking a look back at 2009 projections
those decreases will be significant this year it dropped 8%, a sign that of 2010 budgets vs. 2010 actual spend-
Quality’s 2011 Forecast: $2.57 billion Spending by Size

Quality Software 1,000+ employees Less than 50 employees
$131.0 million Test, Measurement and $442.9 million $216.0 million
Inspection Equipment
$2.07 billion
Quality Services
$367.6 million 50 to 99
employees
$351.5 million
500 to 999
employees
$400.7 million
100 to 249
employees
250 to 499 employees $683.6 million
$592.0 million

ing for quality assurance and control Compared to three years ago, how would you describe
equipment, systems software and ser- your company’s approach to quality today?
vices, 69% of respondents’ projected
budgets were on par with what was Less importance Increased importance
4% 44%
actually spent. Fifteen percent were
over budget, which was up 7% from
the previous year. And 16% were Highest importance
(Aggressively pursuing
under budget, which is down 14% top quality performance)
from the previous year, indicating 29%
that budgets drastically cut because
of the economic conditions have loos-
ened up a bit.
For those companies that were under
budget, a quarter of the companies About the same
level of importance
were under budget by 5% or less, while 23%
one-third of companies were under
budget by more than 25%.
EQUIPMENT EXPENDITURES Where the Dollars will be Spent

The majority of budgets are being Midwest Northeast
spent on test, measurement and $960.5 million $559.8 million
inspection equipment, to the tune of
$2.1 billion. Coordinate measuring
machines (CMMs) look to be the larg-
est capital equipment expenditure next
year at $622.7 million, a 66% increase
from 2010 spending. Computer
numerical control (CNC) CMMs are
projected to increase an amazing 87%
to $249 million in 2011. The majority
of these machines will be purchased in
the Midwest at a rate of $165.2 million.
The next two CMM categories,
portable CMMs and manual CMMs,
expect to generate $112.1 million and
$96.5 million, respectively.
Product testing equipment also looks
to be an area of substantial interest
with spending in the upcoming year to
top out at $403.5 million. West South
Every shop has them—gages and gag- $483.2 million $596.5 million
ing systems. This area looks to increase
13.1% from last year for a total of $331.5
million. Handheld measuring tools, the
workhorses of the industry, are projected Top 10 Planned Equipment Purchases*
to be at $81.2 million, a 3.3% increase
1 CNC Coordinate Measuring Machines $249.1 million
over the previous year’s spending. Fix-
ture and special tooling gages spending 2 Portable Coordinate Measuring Machines $112.1 million
is projected to be $51.1 million. 3 Surface Measurement (waviness, roughness, flatness, contour) $108.3 million
Estimates for optical inspection
4 Manual Coordinate Measuring Machines $96.5 million
and measurement equipment are
$210.9 million for the upcoming year. 5 Direct Numerical Control Coordinate Measuring Machines $87.8 million
The top expenditure in this category, 6 Environmental Test (test chambers, temperature, humidity, vibration) $84.7 million
machine vision systems, expects to
7 Handheld Measuring Tools (calipers, micrometers, indicators, etc.) $81.2 million
garner $55.7 million, a 28.3% jump
from 2010 numbers. This is followed 8 Multiple Sensor Coordinate Measuring Machines $77.2 million
by video measurement systems, $47.2 9 Leak Test $63.0 million
million, and optical comparators,
10 Torque Test $58.5 million
$44.9 million, a 3.5% increase from a
year ago. *”Other” categories were not included in this list.

| S P EC I A L R E P O R T |
Manufacturing Operations Performed (Percent of Respondents) SOFTWARE SALES

When it comes to software, 23% of sur-
Assembly 78% vey respondents said they plan to make
a purchase in 2011, approximately an
Drilling 52% 11% increase from the previous year’s
Finishing 44% numbers. While more people plan on
purchasing software, this area expects
Forming/Fabrication 44%
to see a $26.4 million decrease in
Milling 39% spending from the previous year for a
Welding 38% total of $131 million.
As in years past, data collection
Grinding 38% tops the list of software expenditures
Turning 36% at $23.1 million. This is followed by
enterprisewide quality software, $15.5
Stamping 20%
million; CMM programming and
Injection Molding 14% simulation software, $13.6 million; sta-
tistical process control (SPC) software,
Gear Cutting 6%
$10.3 million; and document control/
Other 18% management, $10.1 million.
In three of the four regions of the
0 10 20 30 40 50 60 70 80 90 100
country—the Midwest, West and
South—CMM programming and
simulation is the number one projected
software expenditure. This makes sense
given that all regions are heavily invest-
Top 5 Planned Services Expenditures
ing in CMMs in the upcoming year.
1 Calibration Services $129.8 million In the Northeast, CMM program-
2 Certification/Registration $53.6 million ming comes in third place, behind
enterprisewide quality software and
3 Lab Testing $25.6 million
calibration software.
4 Contract Part Inspection & Measurement $19.3 million
5 Quality Management $17.9 million QUALITY SERVICES
Quality services include consulting
and training services, as well as test,
measurement and inspection services.
After a difficult year where many
non-mandatory services were cut or
Top 5 Planned Software Purchases* eliminated altogether, overall spending
1 Data Collection $23.1 million for services is expected to reach $367.6
2 Enterprisewide Quality Software $15.5 million million in 2011.
Certification/registration is at the
3 CMM Programming & Simulation $13.6 million top of the consulting and training ser-
4 Statistical Process Control (SPC) $10.3 million vices that will be in demand to the tune
5 Document Control/Management $10.1 million of $53.6 million. This is followed by
quality management consulting at $17.9
*”Other” categories were not included in this listing
million and process improvement at
$17.2 million.
While most companies look to follow
the consulting and training services
trends, companies with 250 to 499
Top 5 Planned Gages & Gaging Systems Expenditures* employees will be spending more than
1 Handheld Measuring Tools (calipers, micrometers, indicators, etc.) $81.2 million double on process improvement con-
sulting and training services than they
2 Fixture & Special Tooling Gages $51.1 million
do on certification/registration servic-
3 Thread Gages $32.8 million es. They plan on spending $9.2 million
4 Plug & Ring Gages $30.2 million on process improvement vs. $4.6
million on certification/registration.
5 Thickness Gages $15.6 million
On the test, measurement and
*”Other” categories were not included in this list. inspection services side, calibration
services tops the list at $129.8 million.

Principal Motives for Investment (Percent of Respondents)
Improve Productivity 60%

Reduce Scrap & Rework 55%
Reduce Costs 50%
Increase Production Capacity 42%
Tighter Part Quality Standards 42%
Comply with ISO Quality Systems 40%
Ramp-up for New Product 40%
Improve Cycle Time 39%
Enhance Machine/Process Flexibility 37%
Regulatory Compliance 28%
0 10 20 30 40 50 60 70
This is followed by lab testing at a very The principal motives behind the When it comes to software, there is
distant $25.6 million and contract part budget increase are to improve produc- no runaway expenditure for compa-
inspection and measurement services tivity (65.3%), reduce scrap and rework nies with 100 to 249 employees. Of the
at $19.3 million. (57.1%), tighter part quality standards $39.1 million budgeted for software,
When all services are considered, (55.1%) and increase production capac- $6.2 million will go toward data collec-
across the country calibration services ity (51%). All of these numbers are tion, $5.3 million will go toward enter-
are the number 1 expenditure. For slightly higher than the industry average. prisewide quality software and $4.1
three of the four regions—the North- When it comes to test, measurement million will go toward CMM program-
east, Midwest and South—this is fol- and inspection equipment, this group is ming and simulation software.
lowed by certification/registration, but looking to spend $534.8 million with the On the heels of a shaky 2010, all
in the West, the category commanding largest amount of dollars ($166 million) indications are that 2011 will be a
the second most significant amount of being devoted to CMMs. The single larg- better year. Conversations with many
money is environmental testing ser- est expenditure in this category is CNC in the industry already point to
vices at $10.8 million. CMMs at an average of $67.7 million. increased demand for products, soft-
Like most companies in this year’s ware and services in the second half
THE TYPICAL COMPANY survey, manufacturers with 100 to 249 of this year, which will carry over into
The largest concentration of respondents employees are looking to invest a good 2011 and—barring any unforeseen
(26%) to this year’s survey are in com- amount of resources into gages and circumstances—well into the future.
panies with 100 to 249 employees. The gaging systems. Overall, $86.9 million
estimated quality market size for these will go toward gages and gaging sys- SURVEY METHODOLOGY
companies in 2011 is $683.6 million. tems, and 22.4% of that will be spent Quality Magazine would like to thank
Let’s take a closer look at the spending on handheld measuring tools. all of the respondents who participated
habits of companies of this size. Breaking down the $109.8 million in the 11th Annual Quality Spending
When compared to three years ago, allocated for quality services, compa- Study. Questionnaires were e-mailed
nearly 30% of respondents at these nies of this size will spend $71.5 mil- in late July 2010 to managers and other
companies say that quality today is of lion on test, measurement and inspec- professionals who have responsibility
the highest importance; 45.8% say that tion services, while another $38.3 for quality and hold the higher degree
it has increased importance; 20.9% million will go toward consulting and of equipment purchasing influence in a
indicate quality is at about the same training services. representative sample of plants. Survey
level of importance and 3.9% indicate Calibration services is the largest respondents were asked to share their
it is of decreased importance. category under the test, measurement spending plans for 2011. The deadline
When asked to compare their 2011 and inspection services umbrella at for responses was August 9, 2010.
budgets vs. their 2010 budgets for qual- $42.1 million. The second largest cat- Surveys were returned by 742 pro-
ity assurance and control equipment, egory—lab testing—lags well behind fessionals for a response rate of 5%.
systems, software and services, 35.1% calibration services at $10.9 million. Respondents had the opportunity
indicated budgets will increase in the The largest category under the con- to win one of three $100 American
coming year, 52% indicated budgets sulting and training services umbrella Express gift cards as an incentive to
will remain the same and 12.8% indi- is certification and registration ($13.1 complete the survey. To estimate 2011
cated spending will decrease. million) for standards such as ISO spending data, responses were weighted
For those looking at an increase, 9000 and TS 16949. This is followed by to the number of plants in each indus-
41.7% of respondents said the increase quality management ($5.4 million) and try served. This survey has a ±3.57%
will be in the 6% to 10% range. lean manufacturing ($5.2 million). margin or error. Q

| QUA LIT Y • P LA N BO O K |
Improve Organizational Performance Through
Quality Auditing
I nterna
nternal
nter nall au
audi
auditing,
diti
ting
ng in tthe
he p
past
astt se
as
years, has been going through a
transformation. Financial accountants
seve
several
v raa l Organizations need to shift from compliance to
performance-based auditing. B Y J I M L . SMI TH
and certified public accountants (CPAs)
are being asked to probe and analyze defined requirements. This type of First, they are performed on a selected
not just records and receipts, but the audit is a verification of the manner in segment of something larger. One does
truly significant management issues. which people, material and machines not audit every financial transaction, every
In many aspects, internal auditing and mesh together to produce a product. It automotive engine cylinder block charac-
quality auditing are being combined examines the adequacy and effective- teristic, every soda can filled to capacity
to achieve a common goal. There are ness of the process controls over the or every management action. An audit
many lessons learned to be shared. equipment and operators as established randomly selects a portion of the available
by procedures, work instructions population and then draws on the data to
DEFINITION OF AN AUDIT and process sheets. Process audits are make conclusions on the whole.
There are essentially four types of audits: appraisal and analytical in nature. Second, all audits require some type
financial, product, process and systems. • A systems audit is known by several of requirement, specification or other
The definitions, applications and require- other names. Among these are quality such measuring criteria from which to
ments of each are described as follows. system audit, management audit, qual- base the audit conclusion. Audits need
• A financial audit is conducted ity program audit, and systems and pro- some sort of performance. Audits are
by personnel trained in business cedures audit. Its objective is to examine generally about effectiveness, whether
accounting processes. Its primary the entire organizational system. it be financial records or a manufac-
purpose is to verify that the account- The two basic forms of this type turing process. An audit is not about
ing methods within an organization of audit are internal and external. efficiency but goodness of the output.
are giving the organization and its The former examines the manage- Finally, all audits are performed by
shareholders a true representation of ment methods within a company or someone who is independent and not
the organization’s financial health. agency, while the latter includes a involved in the activity under review.
• The term product audit is somewhat of review of contractors and suppliers. This gives the audit freedom from bias,
a misnomer. Actually, a product audit independence and respect in the eyes
is a detailed inspection of a finished COMMONALITY of the subject of the audit report.
product performed prior to delivering For our purposes, the definition of an
the product to the customer. Product audit is a “formal evaluation of per- BASICS
audits are typically customer-oriented formance to predetermined standards According to Dennis Arter, an
and focus on elements of product and using that evaluation to stimulate American Society for Quality (ASQ)
specifications to estimate the outgoing improved performance.” It is a struc- Fellow and author of Quality Audits for
quality level of the product. tured means of measuring the confor- Improved Performance, there are four
• A process audit in general is narrowly mance of actions to promises. Despite fundamental rules for performance
focused. It examines an activity to the differences in application for these improvement audits:
verify that the inputs, processing and four forms of an audit, they all have • Define the audit purpose and scope.
outputs are being done according to several things in common. When deciding on the purpose of an
TECH TIPS
 There are essentially four types of  The audit process may end when the  The new audit philosophy is to focus
audits: financial, product, process report is issued by the lead auditor more on effectiveness and con-
and systems. or after follow-up actions have been tinual improvement as organizations
completed and verified. become more performance based.

audit, the needs of the customer must be considered. Like many quality products and services; therefore, they must be held
other service groups, auditors have a variety of product users. The accountable for the resulting work.
ASQ’s standard for auditing, ANSI/ISO 19011 refers to the cus- The role of an auditor is to conduct an objective assessment
tomer of the audit as the client. The client is the person or orga- and provide analyzed information to management. They
nization requesting an audit. Many times the client is a manager are an independent set of eyes and ears for management. An
who is responsible for the production of marketable goods or ser- auditor can find, analyze and report the true impediments
vices. The client makes the final decision on the scope of an audit. to quality and then let affected managers correct those prob-
The audit scope establishes a perimeter around the area lems. However, the key phrase is true impediments.
to be audited and prevents the team from moving into The old school of auditing focused on finding noncompliances
areas that are not relevant to the purpose of the audit. The and nonconformances. This meant digging until something wrong
scope must be established prior to the audit so that both is found. Any auditor can find areas of weaknesses or errors if they
the auditor and auditee know what to expect. The scope dig deep enough. The challenge is to uncover the vital few issues
of an audit greatly influences the number of auditors, its that hinder the organization from performing more efficiently or
duration and ultimately its cost. effectively. Nitpicking to report minutia—the trivial many—adds
Audits provide management with valuable data and frustration, little value and added cost to the organization.
information but careful planning is needed so that disrup- The new audit philosophy is to focus more on effectiveness
tion to the organization during the audit can be mini- and continual improvement as organizations become more
mized. Remember, little productive work is accomplished performance based. Rather than focusing just on adherence or
in the environment of a typical audit. compliance to a certain standard, organizations are assessing
• Identify performance standards. Standards are the criteria their operations against best practices.
against which the performance of an activity is measured. As there is a shift from compliance to performance, organi-
Requirements to audit against can be very formal, such as zations will see the viability of using process and system audits
government regulations. Formal requirements or contrac- as a management oversight tool to monitor, promote and sus-
tual standards are normally written using the words shall, tain continual improvement. Q
must or will to designate a mandatory requirement.
An industry association might develop standards as rules Jim L. Smith has more than 45 years of industry experience in operations, engi-
for belonging, such as hospital accreditation. Usually stan- neering, research and development, and quality management. For more informa-
dards come from within, such as the company policy and tion, e-mail faceofquality@qualitymag.com.
procedures manual or the process instructions for a section
of a manufacturing line. Regardless of the source, standards
represent proven methods of achieving the control desired.
As the eminent Dr. Joseph M. Juran, one of the greatest
quality giants of modern times, was reported to have said,
“without a standard there is no logical basis for making a
decision or taking action.”
Therefore, without performance standards, there can be
no meaningful measurement. In addition, without mea-
surement, audits become conjecture and not fact.
• Develop a plan to address areas of examination. It is
important that all selected requirements of the perfor-
mance standard be addressed during the audit. Also, a
method is needed for organizing all the documents and
working papers that form the final record of the audit.
An effective audit checklist will enable both of these to be
achieved. Not only is a checklist highly recommended, it is
typically required by most audit program standards. Some
organizations like to use generic—sometimes called canned— • A fast, accurate, portable gauge for testing
checklists, but there are several reasons why they not be used. aluminum, brass, copper and steel.
• Report audit results. The final product of an audit is the
report. The purpose of the audit report is to communicate the • Test a variety of shapes, extrusions, tubing
results of the investigation. All of the auditor’s scraps of paper, and flat stock.
notes and objective evidence are reduced to a written report. • Models available to test thickness up to one inch.
The audit process may end when the report is issued by the
lead auditor or after follow-up actions have been completed and WEBSTER INSTRUMENT, INC.
verified. This depends on the needs expressed by the client. 11856 Mississippi Avenue
Los Angeles, California 90025
SHIFT FROM COMPLIANCE TO PERFORMANCE
The concept of the ownership of quality is most important EST. 1932 www.webstertesters.com
to the success of the organization. Managers are paid to pro-
vide the resources for the development and manufacture of Tel. 800-394-3541 • Fax 310-478-1365
Preventive Maintenance
N
for Your SPC
ot ttoo
oo llong
ongg ag
on ago
go I was
was one
one of tthe
he
unfortunates to be infected with
the H1N1 virus. I was testedtested—byby more
than one method—and the doctor
verified it.
Just in case you are wondering. No,
I didn’t
did ’ have
h the
h vaccine.
i No, I did
N didn’t
’
use hand sanitizer as often as I should Is your SPC system performing at its peak condition
have. No, I wasn’t taking any vitamins.
So while I was fighting it off, I began
or does it have a common illness? B Y R I C K SL O O P
to think that a little preventive main-
tenance might have kept me healthy to invade my feverish days of recovery. nesses that infect quality professionals
or at least made the recovery easier. Not only was I thinking about the virus and their process control systems.
Being the geek that I am, thoughts of I was fighting, but I also was thinking Go ahead and snicker, but I’ve met
statistical process control (SPC) began about the types of SPC viruses and ill- plenty of quality professionals and seen
TECH TIPS
 The most common strain of the control limits virus occurs  Symptoms of obsessive compulsive data gathering include
when management sets control limits based on their opin- adding check sheets or new data collection to combat any
ion of where the process should be instead of the reality of production issue.
the process.
 Symptoms of tamper fever include an unnatural desire to
 The double limit vision virus settles in the optic nerve creat- “improve” a process that is in control.
ing a vision distortion that causes one to place both specifi-
cation and control limits on a control chart.

quite a few SPC systems that, in my pro- the symptoms. And don’t worry if your that they make a process perform bet-
fessional opinion, have been infected. system is infected. We’ll also cover the ter than its actual capability.
OK, keep snickering, but how doctor’s tips for preventive mainte- Another mutation results in adjust-
healthy is your SPC system? Has your nance and treatment. ing the control limits to something
SPC system had an exam lately? other than ±3 standard deviations,
Sure, your SPC probably looks OK CONTROL LIMIT VIRUS such as changing to ±2 sigma in an
at a glance. You check it out once in This sneaky little control limits attempt to improve the process.
a while, review a few control charts, virus can even infect mature SPC Still another mutation results in
look for “bad” data and check out the systems. It is commonly transmitted a fever that causes management to
operator comments. Maybe you even directly from quality management to think that control limits should be
give it a slightly longer look during control charts. based on specification limits. The
audits. You may even go so far as to Symptoms include the use of con- fever erases any knowledge that spec-
verify that operators are entering their trol limits that are based on anything ification limits are customer-based
comments, assignable cause codes and other than ±3 sigma or are calculated product requirements while control
corrective actions. from sigma that is not based on an limits are defined by process behav-
But is the system performing? Are average or median dispersion. ior. Once this fever has taken hold,
operators really using the system The most common strain occurs control limits are simply an internal
or are they simply going through when management sets control limits process specification and any chance
the motions? Are you seeing real based on their opinion of where the of using them for a true process
improvements in the process? Is your process should be instead of the reali- improvement is lost.
quality and productivity stagnant or ty of the process. When this virus hits, This virus may lead to a terminal
even deteriorating? management dictates control limits in loss of process improvement if left
If you are not getting the perfor- an attempt to improve or control the untreated.
mance out of your SPC system that you process without understanding that
would like, a quick examination will the control limits are meant to show DOUBLE LIMIT VISION
help determine if there is a problem. process behavior and point out assign- The double limit vision virus may be
Let’s review some of the common able causes. Control limits should transmitted from quality management,
SPC illnesses to see if you have any of never be artificially set with the hope but it is most often contracted from
Quality webinars are

an easy, effective and
convenient way
Valuable to get educated and

informed on the latest
Industry industry topics.
Training Best of all,
they’re FREE!
webinars.qualitymag.com
| QUA LIT Y T EST & IN S P EC TI O N |
production management. There also the specification will be used to ends up in storage on someone’s book-
is a theory that the disease originated adjust the process, without regard shelf instead of actually being used.
from a “corporate” infection, although for the true process behavior. If this Another form of this disease occurs
there is no documented proof. occurs, the process variation increas- when automated data collection meth-
The virus settles in the optic nerve es and the capability of the process ods are used. More data must be better,
creating a vision distortion that causes will decrease. right? So data collection is increased to,
one to place both specification and con-
trol limits on a control chart. Using both
control and specification limits on con-
trol charts results in operator confusion,
Data becomes useless if it is too overwhelming
statistically invalid charts, no real pro- to properly analyze.
cess improvement and, in severe cases,
may lead to death of the SPC system.
The purpose of SPC is to use con- OBSESSIVE COMPULSIVE dare I say it, even 100%. Again, there
trol limits to improve the process DATA GATHERING are so much data collected so rapidly,
based on the process behavior. When Symptoms of obsessive compulsive data that it is not possible create a rational
control limits are utilized, we only gathering include adding check sheets control chart, much less utilize the
adjust the process when there is a true or new data collection to combat any data. Worse yet, try to plot the infor-
statistical signal. production issue. Problems occur when mation on a control chart using data
But when specification limits also there is an overabundance of data, that wasn’t collected rationally.
are used, there is a strong risk that mostly in paper form, and the data Remember, data becomes useless
if it is too overwhelming to properly
analyze.
TAMPER FEVER
ality Wan
t
mor e Symptoms of tamper fever include an
unnatural desire to “improve” a pro-
cess that is in control. Fever induces
Qu
a sense of perfection that causes the
patient to believe that every product
x? can be produced exactly on target
u r inbo regardless of the process capability.
yo try
c t ly to s of indus Those not infected with this virus
dir e and rs,
ivered th e thous Newslet te know that it is not possible to make
de l
ne o f it y e s every product perfect and that tamper-
lr eady o h e Q ual / e new ing with a stable, in-control process
a t m
ng
g .c o
t
’re no c eivi increases variation and actually creates
If you ionals re m a
ss lity an unstable and out of control process.
pr of e w . qua
visit
w w e today! TREATMENT
rib
ubsc Now that we have gone over a few
and s of the most common illnesses, let’s
see what the doctor says. Dr. Walter
Shewhart that is, the father of statisti-
cal quality control and the originator
of the control chart.
Shewhart actually made it easy for
us. He noted only four foundations
must be met in order to use and benefit
from control charts. If all four of these
foundations are maintained, one will
prevent and eliminate all of the ill-
nesses covered here.
Foundation One
Shewhart’s charts always use control limits
which are set at a distance of three sigma
units on either side of the central line.
• Treatment is to always use control
limits which are set at a distance of
1010-Enews-QLT-VS-NDT.indd 1 10/22/10 11:13 AM

three standard deviation units on • Process streams should not be Take a moment to perform a complete
either side of the central line with mixed in the subgroup. If the sub- checkup of your quality system to deter-
the deviation being calculated from group includes output of two or mine if there are any issues that are put-
an average or median dispersion. more process streams and each ting your products at risk. If you find that
• The three-sigma limits must always stream cannot be identified, the the system is on life support, do not fret,
be based on process data. Since the sampling is not rational. getting a clean bill of health may only
control limits define when an action require a little resuscitation and TLC. Q
should be taken on the process, con- Foundation Four
trol limits are never based on any cal- Control charts are effective only to the Rick Sloop is the senior application engineer at
culation using the specification limits. extent that the organization can use, in an InfinityQS International Inc. (Chantilly, VA). For
• Using anything other than three- effective manner, the knowledge gained. more information, e-mail address rsloop@
sigma control limits will lead to a • Adequate training and support must infinityqs.com or visit www.infinityqs.com.
control chart that is either overly be provided by management.
sensitive or not sensitive enough to • An overabundance of charts is worth- QUALITY ONLINE
process changes. Creating charts less if they are not used. It is much For more information on SPC, visit www.quality-
that do not adequately separate better to focus on key characteristics mag.com for the following:
assignable cause and common and see real process improvement. • “Making the Case for SPC”
cause variation will never lead to • Operators must be allowed to • Q-Cast Podcast: “An Overview of SPC and
process improvement. respond to control chart signals. Any Justifying a Software Expense”
knowledge is only as effective as the • “Six Steps to Shop Floor Acceptance of
Foundation Two ability to take action on it. SPC Software”
One must always use an average disper-
sion statistic or a median dispersion
statistic when computing three-sigma
control limits.
• Using the average or median dispersion
increases the robustness of the chart.
• An average or median dispersion
statistic of process data must be used
to create control limits. Calculation
of control limits based on anything
other than true process dispersion
does not work.
Foundation Three
The conceptual foundation of Shewhart’s
charts is the notion of rational sampling
and subgrouping.
• Rational samples are taken with
regard to the way the process is mea-
sured: what, where, how and when it
is measured. Samples must be taken Tune in to Q-Tube and SEE the
frequently enough to monitor any
changes in the process but not so latest in quality technology,
often that autocorrelation between
samples is present. Samples should practices and information.
be selected with the goal of keeping
the process stream intact. Walk Exhibit Floors with Quality Magazine
• After the data has been obtained
rationally, it must be grouped Catch Up on the Quality Innovations
rationally. A rational subgroup View the Latest in Products
is one where there is little pos-
sibility of having assignable cause Watch Industry Leaders
variation between samples within
the subgroup itself. If only com-
mon cause variation exists within
the samples, then any differences
within or between the subgroups
will be attributable to assignable
and click on Q-Tube.
cause variation.
1108-house-qtube.indd 5 10/21/08 4:48:39 PM

The
Outsourcing of HR
T he uncertain manufacturing land-
scape has led many American plant
While the manufacturing industry is well aware of the
benefits outsourcing can provide, few realize that these
owners to realize the need for better
managed human resources (HR) solu- benefits can be applied to human resource management.
tions in order to save money, stay com- BY DAV I D I MB RO G N O
pliant with changing regulations, and
improve benefits offerings to attract
and retain talent. continues to direct employees’ day-to- the business rather than being over-
While the manufacturing industry is day activities while the PEO takes on whelmed by HR and payroll needs.
well aware of the benefits outsourcing human resource management duties. There are several key strategic ben-
can provide, few realize that these ben- PEOs assume certain employer rights, efits that manufacturers can realize by
efits can be applied to human resource responsibilities and risks such as being partnering with a strong PEO. Among
management. For small- and mid-sized the employer of record on employee the most critical:
businesses, an effective solution is the W-2 forms, as well as managing and • More productive use of time and
use of a professional employer organi- delivering equal employment opportu- resources. This is particularly criti-
zation (PEO) to easily manage these nity commission (EEOC) claims and cal for small- to mid-size companies
ever-shifting needs. state unemployment insurance. whose profitability depends on
First, it is important to understand efficient production and distribu-
that a PEO provides integrated services, KEY STRATEGIC BENEFITS tion. With a PEO handling much
through a co-employment arrangement, PEOs offer solutions that help reduce of the day-to-day HR administra-
which enables business owners to cost- the costs and complexities related to tion, companies can devote inter-
effectively outsource the management employment and human resource nal resources and capital funds to
of human resources, employee benefits, management. Companies that focus revenue-generating activities.
payroll and workers’ compensation. on creating high-quality products and • Improved business focus. Many com-
Co-employment means that a maintaining strict industrial guide- panies have outsourced processes and
company remains an employer and lines are then able to focus on growing services that they previously handled
TECH TIPS
 A PEO provides integrated services, through a co-employment  A key benefit of a PEO is that client companies have access
arrangement, which enables business owners to cost- to the human resources and compliance expertise necessary
effectively outsource the management of human resources, to manage critical HR responsibilities and risks, and stay
employee benefits, payroll and workers’ compensation. ahead of the compliance curve.
 With a PEO handling much of the day-to-day HR administra-  With access to Fortune 500 company-level benefits, human
tion, companies can devote internal resources and capital resource management system technology, training and
funds to revenue-generating activities. development, PEOs can provide manufacturing companies
with that extra layer of competitiveness.

in-house—HR/payroll is a prime Karpen’s co-owners, Eric Henken and unable to offer or manage efficiently.
example. By partnering with a PEO, Rachel Smith, are quick to acknowledge Smith also points out one key char-
manufacturing companies can tighten that having the PEO relationship has acteristic that manufacturers should
their focus on producing, marketing been a boon to their business. Henken look for in considering different PEOs:
and delivering products—not HR points to the full range of HR expertise industry longevity and stability, both
paperwork and compliance issues. that a PEO brings to the table: “I can’t as a company and among its individual
• Guidance from experts across the imagine going into a business with 30 associates. “We have had the same HR
business spectrum. During the past employees and have to learn about HR person, the same safety person, the
two years there has been an intensi- and how to deal with it.” same benefits person and the same pay-
fied emphasis on compliance by Smith agrees, and elaborates on the roll person since we started. It’s really
federal regulatory agencies, including reasons why Karpen chose to partner with the feeling of have an HR team on staff.”
OSHA, the Department of Labor and a PEO, “As our company grew, our ben- She sums up her company’s experience
others. A key benefit of a PEO is that efit package was no longer holding up… in a way that should ring true for many
client companies have access to the our way of doing business with HR was small- to mid-size manufacturers, “I love
human resources and compliance no longer good enough to necessarily be serving customers. I love custom work. I
expertise necessary to manage criti- leading edge any more. We had different love problem-solving. I did not get into
cal HR responsibilities and risks, and companies handling our health insurance, the business to spend my time on human
stay ahead of the compliance curve. workers’ comp and dental insurance. We resources, health insurance and all those
• The ability to offer a better overall were about to lose our long-term disability other aspects of the business.”
package of benefits. Increased auto- insurance because we didn’t have enough What the PEO relationship has
mation translates into an increased employees signed up for it.” given Karpen, according to Smith, is
emphasis on attracting and retaining Working with these different vendors, “more time for doing what this busi-
skilled employees. With access to plus one for payroll, meant a paper- ness is supposed to be doing.” Q
Fortune 500 company-level benefits, work and administrative burden that
state-of-the-art human resource man- one Karpen employee describes as a David Imbrogno is GM Southeast Region for ADP
agement system technology, training “nightmare.” With the PEO relationship, TotalSource (Miami, FL). For more information,
and development, PEOs can provide Karpen has access to benefits and admin- e-mail david_imbrogno@adp.com, call (678)
manufacturing companies with that istrative support that previously they were 319-6241 or visit www.adptotalsource.com.
extra layer of competitiveness.
MAKING THE DECISION TO GO

WITH A PEO
Manufacturers are increasingly moving
toward the outsourcing model for a wide
range of noncore functions, everything
from maintenance and information tech-
www.qualitymag.com
nology to parts manufacturing and pay-
roll. The goal is to focus time, energy and Reaching the BEST BUYERS in Quality and Manufacturing
resources on business-critical functions,
and outsourcing HR is a natural step in
the process.
More specifically, as manufacturing
companies seek ways to reduce opera-
tional costs related to managing HR, pay-
roll and compliance, increase employee
productivity, take a more proactive
stance on risk management and safety in
response to increased OSHA demands Practical Methods to Improve Your Manufacturing Processes
and improve recordkeeping to aid com-
pliance efforts, the services PEOs offer are
increasingly seen as a valuable solution.
The example of Karpen Steel is
instructive. Located in Weaverville, NC,
Karpen is a custom door and frame The Practical Use of NDT Real-World Application of Vision and Sensor
nondestructive testing
Systems, Components, Software and Services
manufacturer whose attention to quality including materials test
www.ndtmag.com
and Materials Test Technology
www.visionsensorsmag.com
and customer service makes it a national
brand. With approximately 30 employ- Contact your Quality Marketing Manager today!
ees, Karpen fits squarely the profile of a Group Publisher Barbara Grim Bill DeYoe Buck Bicek Inside Sales/Classifieds
manufacturer for whom partnering with Darrell Dal Pozzo (856) 358-4800 (704) 822-6434 (630) 971-0904 Sunny Coverly
(630) 694-4342 Fax: (856) 358-0900 Fax: (704) 822-6834 Fax: (248) 502-1086 (610) 932-8350
a PEO can make strategic sense. Fax: (248) 502-1024 grimb@bnpmedia.com deyoeb@bnpmedia.com bicekb@bnpmedia.com Fax: (248) 283-6587
dalpozzod@bnpmedia.com coverlys@bnpmedia.com

CA SE ST U DI ES
All the information needed for project

teams to meet milestones and stay on
track is at one’s fingertips in AtTask.
Source: AtTask
Rawlings, part of Jarden Team

Sports, is the leading manufacturer
and marketer of baseball equipment
and other sporting goods in the
United States. As the official baseball
and helmet manufacturer of Major
League Baseball and the official ball
producer of the NCAA baseball cham-
pionships, Rawlings was looking for
a project management solution that
would allow it to accelerate new prod-
uct introduction and increase early
market penetration.
“Most college baseball teams start
hitting the batting cages in the fall,”
says Ben McIntosh, commercialization
manager at Rawlings. “If we can get
Early Market next season’s bats in the hands of col-
Penetration
lege players in the fall, they’ll be using
our bats the following spring. We chose
AtTask as our project management
solution because we believe they will
help us do that.”
and Continuous Improvement The challenges associated with new
product research and development
in a global manufacturing environ-
C ontinuous improvement is the life-

blood of any successful organiza-
tion. As the economy improves, the
leaders have been able to utilize the
structure of project management meth-
odologies to successfully manage other
ment made it difficult for Rawlings
to make accurate projections on new
product introduction and delivery. To
lessons learned by those organizations types of project-based work, including accelerate the new product develop-
that have successfully maximized their marketing, financial services and new ment and manufacturing of baseball
resources, streamlined processes and product development. bats, Rawlings needed a project and
facilitated effective workforce collabo- As organizations become more portfolio management (PPM) solu-
ration have become more competitive global in terms of product develop- tion that would provide increased
and captured greater market share in ment and manufacturing, it has visibility into the research and devel-
recent years. Many business leaders become increasingly important for opment process while addressing
wisely turned to project methodologies managers to efficiently manage teams three specific objectives. These objec-
to facilitate an environment of process in different time zones and different tives include:
improvement during the recent eco- languages, and do it all in real time. • Fostering collaboration. Coordinat-
nomic downturn. Utilizing the methods and the right ing teamwork among their global
Although project management software solutions to enable today’s development team was critical to the
methodologies have traditionally found project managers to work with teams new product development process.
their home within IT and software spread throughout the world has The solution needed to address the
development, many savvy business become increasingly important. needs of project teams in different
BENEFITS
 AtTask gives Rawlings visibility into  AtTask automatically creates project  AtTask enables companies to deploy
every initiative, enabling them to projections based on real-time globally, increase visibility and
search for any product known to be project status. accountability, and accelerate
in development and identify where market penetration.
it is in the process.

time zones, different countries and
teams speaking different languages.
• A centralized location. An area
accessible to everyone on the proj-
ect team for shared development
data was necessary to enable mem-
bers to more efficiently manage
the information needed to meet
project milestones.
• The ability to accurately forecast
projected completion dates. Iden-
tifying lagging projects early was
deemed critical to keep projects on
schedule. Knowing that a project is
in trouble after it is too late is of no
value to any organization.
A NEW DIRECTION
To support Rawlings’ objective to
provide transparency, reduce costs
and drive new product introduc-
tion, AtTask enables companies to
deploy globally, increase visibility and
accountability, and accelerate mar-
ket penetration. Rawlings leverages
AtTask’s solution to facilitate team col-
laboration anywhere bats are manu-
factured. Because AtTask works on any
platform and browser, automatically
accounts for different time zones and
is the only PPM solution available in
English, Spanish and Chinese, Rawl-
ings’ global development teams can
collaborate and work together in real
time.
Centralizing project data enables
Rawlings to increase visibility and
accountability on every project from
concept to delivery. All the information
needed for project teams to meet mile- AtTask allows Rawlings project teams to successfully collaborate from anywhere in the
stones and stay on track is at AtTask’s world. Source: AtTask
fingertips, empowering Rawlings’ proj-
ect teams to deliver on time.
AtTask automatically creates project search for any product known to be in helping us keep projects on track so we
projections based on real-time project development and identify where it is can hit our scheduled delivery date.
status. This enables Rawlings to accu- in the process, the anticipated delivery “We considered 12 to 13 other proj-
rately forecast projected completion date and whether it can be expected to ect management solutions,” McIntosh
dates, giving project managers the meet the scheduled delivery date. continues. “Compared to the other
information needed to keep projects Giving project managers a heads-up solutions we considered, I was confi-
on track, help project teams be more on potentially lagging projects enables dent that AtTask would do what we
efficient and expedite the development Rawlings’ project managers to take needed it to do. From the minute I
process, thereby shortening the time it actions to bring projects back on track watched the online demo, I haven’t
takes for Rawlings to get to market with before it is too late. “Our product is been disappointed.”
new products and to grow market share. 100% seasonal,” McIntosh says. “If we
miss our deadline, our opportunity AtTask
SUCCESSFUL ANYWHERE for that year is lost. AtTask allows us (801) 373-3266
AtTask gives Rawlings visibility into to know exactly where any product in www.attask.com
every initiative, enabling them to development is at, at any point in time— Reply 12

CA SE ST U DI ES
industry of proven value-added part-

ners who are focused on financial and
investment management.”
In 2003, Magnatek was navigating
a challenging financial and regulatory
market. To further complicate matters,
the company’s stock price had expe-
rienced a significant decrease due to
one-time factors such as asset impair-
ment charges, a lawsuit settlement and
various divestitures.
At the same time, Magnetek was
looking to maximize its opportunities
for growth by ramping up R&D and
increasing the size of its sales force.
This meant that it was critical to con-
trol noncore costs.
When evaluating where the com-
pany stood at the time and where it
wanted to go, it was critical to first
identify expenses related to its pension
plan. In the past, the pension plan had
provided positive earnings, thereby
helping the organization’s bottom line.
Ground Up
Those earnings had now turned into an
expense that was nearly triple what the
earnings had been.
Pension
To manage the cost of running the
pension plan, the company decided
to freeze benefit accruals, resulting in
an immediate decrease in the plan’s
service costs. Freezing accruals also
meant a projected decrease in the
Improvements plan’s liabilities as they would no lon-

ger be growing. At the time, this move
provided the company with financial
relief in that it would not have to make
P ensions continue to have a sig-

nificant impact on corporate
operations, with underfunded liabilities
pension plan. During its 25 years in busi-
ness, the publicly traded manufacturer
has become a leading international sup-
pension contributions for the next five
years. However, this also meant Mag-
netek was due to make an $18 million
draining needed cash flow. In an effort pliers of digital power and motion control pension contribution in 2008.
to concentrate on the more complex systems for the manufacturing industry. “We could not be in a position
strategic issues involved in managing a “Our core competencies lie in the where the pension plan interfered with
pension plan, many plan sponsors are design and manufacture of power and our organizational goals of growing
outsourcing the investment manage- motion control systems, not in actively the business,” says Schwenner. “We
ment process to an outside cofiduciary managing financial asset portfolios,” needed to develop creative solutions
partner, according to industry research. says Marty J. Schwenner, vice president for not only delivering this benefit to
Magnetek (Menomonee Falls, WI) has and chief financial officer at Magnetek. our employees who had earned it, but
already shifted toward an outsourced “That is not where our organizational also having the financial flexibility and
investment management model for the strengths lie, but there is an entire resources to invest in our business.”
BENEFITS
 The outsourced model allowed for a  The end result was a custom funding  SEI’s model provides clients with
reallocation of the time of internal strategy that required pension strategic advice around asset
resources to bigger-picture items. contributions of $4 million per year allocation decisions and their impact
for a span of three years. on the goals and objectives of
the organization.

In 2003, Magnetek
was navigating a
challenging financial
and regulatory market.
Source: Magnetek.
TIME WAS OF THE ESSENCE under expected market conditions, while aiming to decrease
Like many companies, Magnetek wanted its pension plan to downside risk under poor market conditions. The new
be easy to manage, meet investment goals and adhere to reg- portfolio was designed to try to decrease volatility in the
ulatory obligations. And while the company had previously plan by increasing diversification at both the asset class and
handled much of its investment management work internally, manager levels.
resources were needed in other places. “From day one, the understanding was that we’re operating
As a result, the organization decided to review its entire with not just the pension plan, but in a larger business con-
process for managing the pension and underwent a rigorous text,” Schwenner says.
search process, looking for a firm able to step into a complex Today, Magnetek has a pension plan that is designed to
situation and deliver successful results. efficiently sync with its corporate goals and requirements.
In the end, Magnetek decided to shift to an outsourced With this model in place, Magnetek has more time and
investment management model and hired asset management resources to focus on achieving its corporate objective of
firm SEI (Oaks, PA). growing and expanding its business.
The outsourced model allowed for a reallocation of the
time of internal resources to bigger-picture items, which was SEI
the most efficient solution. (610) 676-1000
Through its outsource model, SEI took on fiduciary respon- www.seic.com
sibility for researching, selecting and monitoring investment Reply 12
managers that fit the ongoing strategies for the asset allocation
set forth by Magnetek’s pension committee.
This setup allows Magnetek’s finance staff to focus on the
organization achieving its short- and long-term goals, with the
assurance that its pension plan is run and managed properly.
THE PENSION EXPENSE SOLUTION

Ensuring that the pension plan was funded without hurting
the company’s growth efforts and sales budgets required a
smart approach to managing the flow of cash into the pension
fund. A key component was determining how to minimize the
anticipated $18 million contribution that loomed in 2008.
In addition to manager oversight, SEI’s model provides cli-
Has your company been profiled in a
ents with strategic advice around asset allocation decisions and recent issue of Quality magazine?
their impact on the goals and objectives of the organization. Reprints of articles can be a single
SEI’s team performed extensive modeling using Magnetek’s sheet or multiple pages. Reprints are
available in full color or black and
pension plan data as well as its financial statements and forecasts. white in quantities of 500 or more.
Magnetek and SEI worked together in this process and identified
several options for developing specific strategies that would align Quality reprints can be distributed at
trade shows, displayed in show rooms,
the pension plan with overall corporate finance goals. corporate offices or as part of promotional
“Previously, the pension had been managed in a vacuum efforts – just to name a few!
outside of corporate finance objectives. If the goal was to make
Quality reprints at a reasonable cost!
sure that the pension did not negatively impact corporate Call today for a quote or visit
finance, the two had to become aligned,” Schwenner explains. www.qualitymag.com for a custom quote.
The end result was a custom funding strategy that required
Contact Sunny Coverly today!
pension contributions of $4 million per year for a span of three (610) 436-4220 ext. 8522
years, starting in 2006. This strategy was designed to improve coverlys@bnpmedia.com
the plan’s funded status and would build up the credit balance
over the course of the 10-year timeframe, thus removing the
$18 million contribution spike in 2008.
The portfolio also was restructured with a goal of per-
www.qualitymag.com
forming comparably to the company’s previous portfolio

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CL A SSI F I ED To place a classified ad in Quality, call Sunny Coverly at (610) 932-8350, or FAX: (248) 283-6587
PRODUCTS SERVICES SERVICES
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A DV E RT I SI NG I NDEX For more information, visit Quality Quick Clicks at qualitymag.com.
ADVERTISER PAGE REPLY # PHONE WEBSITE
Bruker IFC 351 (800) 366-9956 www.handledxrf.com
1050 IL Route 83, Cybermetrics Corp. BC 145 (800) 777-7020 www.cybermetrics.com

Suite 200
Bensenville, IL
60106-1096 Edmund Optics 3 123 (856) 547-3488 www.edmundoptics.com
Group Publisher Micro-Vu Corp. 19 412 (707) 838-6272 www.microvu.com

Darrell Dal Pozzo
(630) 694-4342
dalpozzod@bnpmedia.com S-T Industries Inc. 10, 11 404 (800) 326-2039 www.stindustries.com
REGIONAL MARKETING
Webster Instrument Inc. 25 427 (310) 478-1365 www.webstertesters.com
New England and
Mid-Atlantic This index is provided as a reader service. The publisher assumes no liability for errors or omissions.
Barbara Grim
1288 Centerton Rd.
Pittsgrove, NJ 08318
Phone: (856) 358-4800
FAX: (856) 358-0900
grimb@bnpmedia.com
Central and Southeast

Bill DeYoe
109 Willow Springs Trail
Mt. Holly, NC 28120
Phone: (704) 822-6434
FAX: (704) 822-6834
deyoew@bnpmedia.com
Midwest, Southwest,
West and Northwest
Buck Bicek
1050 IL Route 83
Suite 200
Bensenville, IL 60106
Phone: (630) 971-0904
FAX: (630) 227-0204
bicekb@bnpmedia.com
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December 2010

A New Name. A New Dawn of Innovation.

For more information visit www.bruker.com,

Innovation with Integrity

From the Editor

FEATURES 32 Case Study

ABOUT THE COVER

www.qualitymag.com December 2010 | QUALITY GLOBAL EDITION 1

The Human Side of Quality: A Fundamental Concept

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S-T Industries, Inc. began manufactur-

S-T Industries Inc. ing precision measuring tools in St.

James, Minnesota, in 1942. S-T is still

known worldwide for its lightweight

tubular frame micrometers with stan-

dard models available up to 96 inches.

S-T also manufactures a complete line

of solid frame micrometers, specialty

micrometers, inside and depth microm-

eters and has a complete line of measur-

ing tools available.

S-T has manufactured thousands of

modified and special measuring tools

over the past 66 years and welcomes

your inquiries for specials.

S-T also manufactures a complete

range of optical comparators, horizontal

and vertical types in screen diameters of

14”, 16”, 24” and 30”. All models feature

Acu-Rite TM precision glass scales with

a resolution of .00005”/.001MM and

a choice of Quadra-Chek TM digital

readout systems including the QC-100,

QC-200, QC-300 and QC-5000 series.

The 24” and 30” models include stan-

dard motorized joystick controls in the X

and Y axis travel and are available with

fully automatic CNC controls. Smaller

units are also available with motor con-

trols and fully automatic CNC controls.

Special inquiries are also welcome. S-T

has supplied units with extended vertical

travel, special long focal length lens and

X-axis travel up to 30 inches.

10 QUALITY GLOBAL EDITION | December 2010 www.qualitymag.com

S-T also manufactures a series of

video inspection systems with stage

travels of 4”X8”, 4”X12”, 6”X8”, 6”X12”

• Duplex surface illumination.