UNIT III

STATISTICAL PROCESS CONTROL AND PROCESS CAPABILITY

INTRODUCTION
The application of the principles and philosophies of quality
management calls for capability assessment. This has to be
undertaken by the professionals through the process of
reengineering. There are specifc control tools like SPC, to be
adopted in various industries at various stages. To achieve TQ,
every aspect of it !hether it is reliability, maintenance, micro
level technology assimilation has to be re"looked into. This
comprehensive e#ercise !ill bring out the best part of
organi$ational capabilities. This unit deals !ith eaning and
signifcance of Statistical Process Control %SPC&, Construction of
Control Charts for variables and attributes, Process Capability '
eaning, Signifcance and easurement, Si# sigma concepts of
process capability, (eliability Concepts ' )efnitions, (eliability in
Series and Parallel, Product *ife Characteristics Curve, Total
Productive aintenance %TP&, (elevance to TQ,
Terotechnology, +usiness Process (e"engineering %+P(&,
Principles, ,pplications, (eengineering Process, +enefts and
*imitations.
LEARNING OBJECTIVES
-pon completion of this unit, you !ill be able to.
,ssess the importance and need for process control.
)evelop and use various charts and techniques for SPC
,naly$e the evolution of si# sigma
-nderstand the reliability variants and their applications
/et a scenario about +P( and its usage.
,pply various process control techniques in real life
situation.
3.1 MEANING AND SIGNIFICANCE OF STATISTICAL PROCESS
CONTROL (SPC)
Statistical process control %SPC& is a method for achieving quality
control in manufacturing processes. 0t employs control charts to detect
!hether the process observed is under control.
Classical quality control !as achieved by inspecting 1223 of the
fnished product and accepting or re4ecting each item based on ho!
!ell the item met specifcations. 0n contrast, statistical process control
uses statistical tools to observe the performance of the production line
to predict signifcant deviations that may result in re4ected products.
The underlying assumption is that there is variability in any production
process. The process produces products !hose properties vary slightly
from their designed values, even !hen the production line is running
normally, and these variances can be analy$ed statistically to control
the process. 5or e#ample, a breakfast cereal packaging line may be
designed to fll each cereal bo# !ith 622 grams of product, but some
bo#es !ill have slightly more than 622 grams, and some !ill have
slightly less, in accordance !ith a distribution of net !eights. 0f the
production process, its inputs, or its environment changes %for
e#ample, the machines doing the manufacture begin to !ear& this
distribution can change. 5or e#ample, as its cams and pulleys !ear
out, the cereal flling machine may start putting more cereal into each
bo# than specifed. 0f this change is allo!ed to continue unchecked,
more and more product !ill be produced that fall outside the
tolerances of the manufacturer or consumer, resulting in !aste. 7hile
in this case, the !aste is in the form of 8free8 product for the
consumer, typically !aste consists of re!ork or scrap.
+y using statistical tools, the quality engineer responsible for the
production line can troubleshoot the root cause of the variation that
has crept in to the process and correct the problem.
Focus Ar!" #u!$%&' ( M!sur)*&

D+*%&%o* !*, Su))!r'. ,pplying statistical process control %use of
control charts& to the management of soft!are development e9orts, to
e9ect soft!are process improvement.

Statistical Process Control %SPC& can be applied to soft!are
development processes. , process has one or more outputs, as
depicted in the fgure belo!. These outputs, in turn, have measurable
attributes. SPC is based on the idea that these attributes have t!o
sources of variation. natural %also kno!n as common& and assignable
%also kno!n as special& causes. 0f the observed variability of the
attributes of a process is !ithin the range of variability from natural
causes, the process is said to be under statistical control. The
practitioner of SPC tracks the variability of the process to be
controlled. 7hen that variability e#ceeds the range to be e#pected
from natural causes, one then identifes and corrects assignable
causes.
Focus Ar!" #u!$%&' ( M!sur)*&

D+*%&%o* !*, Su))!r'. ,pplying statistical process control %use of
control charts& to the management of soft!are development e9orts, to
e9ect soft!are process improvement.

Statistical Process Control %SPC& can be applied to soft!are
development processes. , process has one or more outputs, as
depicted in the fgure belo!. These outputs, in turn, have measurable
attributes. SPC is based on the idea that these attributes have t!o
sources of variation. natural %also kno!n as common& and assignable
%also kno!n as special& causes. 0f the observed variability of the
attributes of a process is !ithin the range of variability from natural
causes, the process is said to be under statistical control. The
practitioner of SPC tracks the variability of the process to be
controlled. 7hen that variability e#ceeds the range to be e#pected
from natural causes, one then identifes and corrects assignable
causes.
FIGURE 3.1


These benefts of SPC cannot be obtained immediately by all
organi$ations. SPC requires defned processes and a discipline of
follo!ing them. 0t requires a climate in !hich personnel are not
punished !hen problems are detected, and strong management
commitment.
Su))!r' Dscr%-&%o*
Statistical Process Control %SPC& can be applied to soft!are
development processes. , process has one or more outputs, as
depicted in the frst fgure belo!. These outputs, in turn, have
measurable attributes. SPC is based on the idea that these attributes
have t!o sources of variation. natural %also kno!n as common& and
assignable %also kno!n as special& causes. 0f the observed variability
of the attributes of a process is !ithin the range of variability from
natural causes, the process is said to be under statistical control. The
practitioner of SPC tracks the variability of the process to be
controlled. 7hen that variability e#ceeds the range to be e#pected
from natural causes, one then identifes and corrects assignable
causes.
FIGURE 3..
SPC is a po!erful tool to optimi$e the amount of information
needed for use in making management decisions. Statistical
techniques provide an understanding of the business baselines,
insights for process improvements, communication of value and
results of processes, and active and visible involvement. SPC
provides real time analysis to establish controllable process
baselines: learn, set, and dynamically improve process
capabilities: and focus business on areas needing improvement.
SPC moves a!ay from opinion"based decision making.
Dscr%-&%o* o/ &0 Pr!c&%c"

Statistical Process Control %SPC& can be applied to soft!are
development processes. , process has one or more outputs, as
depicted in 5igure 1. These outputs, in turn, have measurable
attributes. SPC is based on the idea that these attributes have t!o
sources of variation. natural %also kno!n as common& and assignable
%also kno!n as special& causes. 0f the observed variability of the
attributes of a process is !ithin the range of variability from natural
causes, the process is said to be under statistical control. The
practitioner of SPC tracks the variability of the process to be
controlled. 7hen that variability e#ceeds the range to be e#pected
from natural causes, one then identifes and corrects assignable
causes. 5igure ; depicts the steps in an implementation of SPC.
FIGURE 3.3
FIGURE 3.1 S&!&%s&%c!$ Procss Co*&ro$
The key steps for implementing Statistical Process Control are.
o 0dentify defned processes
o 0dentify measurable attributes of the process
o Characteri$e natural variation of attributes
o Track process variation
o 0f the process is in control, continue to track
o 0f the process is not in control.
" 0dentify assignable cause
" (emove assignable cause
" (eturn to <Track process variation=
D&!%$, Dscr%-&%o*
2o3 To
Pr/or)
SPC
0n practice, reports of SPC in soft!are development and
maintenance tend to concentrate on a fe! soft!are processes.
Specifcally, SPC has been used to control soft!are %formal&
inspections, testing, maintenance, and personal process improvement.
Control charts are the most common tools for determining !hether a
soft!are process is under statistical control. , variety of types of
control charts are used in SPC. Table 1, based on a survey >(adice
;222? of SPC usage in organi$ations attaining *evel @ or higher on the
SA0 C metric of process maturity, sho!s !hat types are most
commonly used in applying SPC to soft!are. The combination of an
-pper Control *imit %-C*& and a *o!er Control *imit %*C*& specify, on
control charts, the variability due to natural causes. Table ; sho!s the
levels commonly used in setting control limits for soft!are SPC. Table
B sho!s the most common statistical techniques, other than control
charts, used in soft!are SPC. Some of these techniques are used in
trial applications of SPC to e#plore the natural variability of processes.
Some are used in techniques for eliminating assignable causes.
,nalysis of defects is the most common technique for eliminating
assignable causes. Causal ,nalysis"related techniques, such as Pareto
analysis, 0shika!a diagrams, the Cominal /roup Technique %C/T&, and
brainstorming, are also frequently used for eliminating assignable
causes.
T!4$ 3.1" Us!5 o/ Co*&ro$ C0!r&s

T'- o/
Co*&ro$6A&&r%4u&
C0!r&
Prc*&!5

74!r()R 33.38
u(C0!r& .3.38
74!r 13.38
c(C0!r& 9.:8
;(C0!r& 9.:8
No& c$!r$' s&!&, 19.:8
5rom (on (adiceDs survey of ;6 C *evel @ and *evel 6 organi$ations
>(adice ;222?

T!4$ 3.." Loc!&%o* o/ UCL(LCL %* Co*&ro$ C0!r&s
Loc!&%o* Prc*&!5

T0r(
s%5)!
198
T3o(s%5)! 18
O*(
S%5)!
<8
Co)4%*!&%
o*
198
No*6No&
C$!r
.18
5rom (on (adiceDs survey of ;6 C level @ and level 6 organi$ations
>(adice ;222?

T!4$ 3.3" Us!5 o/ O&0r S&!&%s&%c!$ Tc0*%=us
S&!&%s&%c!$
Tc0*%=u
Prc*&!5

Ru* C0!r&s ...<8

2%s&o5r!)s .1.18
P!r&o
A*!$'s%s
.1.18
Sc!&&r
D%!5r!)s
1>.?8
R5rss%o*
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:.>8
P% C0!r&s 3.?8
R!,!r6@%A%!&
C0!r&s
3.?8
O&0r 1>.?8
5rom (on (adiceDs survey of ;6 C level @ and level 6
organi$ations >(adice ;222?
Control charts are a central technology for SPC. 5igure B sho!s a
sample control chart constructed from simulated data. This is an E"
chart, !here the value of the attribute is graphed. Control limits are
graphed. 0n this case, the control limits are based on a priori
kno!ledge of the distribution of the attribute !hen the process is
under control. The control limits are at three sigma. 5or a normal
distribution, 2.;3 of samples !ould fall outside the limits by chance.
This control chart indicates the process is out of control. 0f this control
chart !ere for real data, the ne#t step !ould be to investigate the
process to identify assignable causes and to correct them, thereby
bringing the process under control.
FIGURE 3.?
Some have e#tended the focus of SPC in applying it to soft!are
processes. 0n manufacturing, the primary focus of control charts is
to bring the process back into control. 0n soft!are, the product is
also a focus. 7hen a soft!are process e#ceeds the control limits,
re!ork is typically performed on the product. 0n manufacturing, the
cost of stopping a process is high. 0n soft!are, the cost of stopping
is lo!er, and fe! shutdo!n and startup activities are needed >Falote
and Sa#ena ;22;?.
SPC is one !ay of applying statistics to soft!are engineering.
Gther opportunities for applying statistics e#ist in soft!are
engineering. Table @ sho!s, by lifecycle phase, some of these uses of
statistics. The Cational (esearch Council recently sponsored the Panel
on Statistical ethods in Soft!are Angineering >C(C 1HHI?. The panel
recommended a !ide range of areas for applying statistics, from
visuali$ing test and metric data to conducting controlled e#periments
to demonstrate ne! methodologies.
Table 3.4: Some Applications of Statistics in Software
Engineering
P0!s Us o/ S&!&%s&%cs
R=u%r)*&
s
Specify performance goals that can be measured statistically, e.g., no
more than 62 total feld faults and $ero critical faults !ith H23
confdence.
Ds%5* Pareto analysis to identify fault"prone modules. -se of design of
e#periments in making design decisions empirically.
Co,%*5 Statistical control charts applied to inspections.
Ts&%*5 Coverage metrics provides attributes. )esign of e#periments useful in
creating test suites. Statistical usage testing is based on specifed
operational profle. (eliability models can be applied.
+ased on >)alal, et. al. 1HHB?
Those applying SPC to industrial organi$ations, in general, have
built process improvements on top of SPC. The focus of SPC is on
removing variation caused by assignable causes. ,s defned here, SPC
is not intended to lo!er process variation resulting from natural
causes. any corporations, ho!ever, have e#tended their SPC e9orts
!ith Si# Sigma programs. Si# Sigma provides continuous process
improvement and attempts to reduce the natural variation in
processes. Typically, Si# Sigma programs use the <Seven Tools of
Quality= %Table 6&. The She!hart Cycle %5igure @& is a fundamental idea
for continuous process improvement.
Table 3.5: The Seven Tools of Quality
Too$ EB!)-$ o/ Us
C0cC S0& To count occurrences of problems.
2%s&o5r!) To identify central tendencies and any ske!ing to one side
or the other.
P!r&o C0!r& To identify the ;23 of the modules !hich yield J23 of the
issues.
C!us !*, EDc&
D%!5r!)
5or identifying assignable causes.
Sc!&&r D%!5r!) 5or identifying correlation and suggesting causation.
Co*&ro$ C0!r& 5or identifying processes that are out of control.
Gr!-0 5or visually displaying data, e.g., in a pie chart.
FIGURE 3.9
A*&%c%-!&, B*+&s o/ I)-$)*&!&%o*

SPC is a po!erful tool to optimi$e the amount of information
needed for use in making management decisions >Aickelmann and
,nant ;22B?. Statistical techniques provide an understanding of the
business baselines, insights for process improvements, communication
of value and results of processes, and active and visible involvement.
SPC provides real time analysis to establish controllable process
baselines: learn, set, and dynamically improve process capabilities:
and focus business on areas needing improvement. SPC moves a!ay
from opinion"based decision making >(adice ;222?.
These benefts of SPC cannot be obtained immediately by all
organi$ations. SPC requires defned processes and a discipline of
follo!ing them. 0t requires a climate in !hich personnel are not
punished !hen problems are detected. 0t requires management
commitment >)emmy 1HJH?.
D&!%$, C0!r!c&r%s&%cs
The processes controllable by SPC are unlimited in application
domain, lifecycle phase, and design methodology. Processes
need to e#hibit certain characteristics to be suitable for SPC %as
sho!n in the table belo!&. 0n addition, a process to !hich SPC is
applied should be homogeneous. 5or e#ample, applications of
SPC to soft!are inspections have found that inspections must
often be decomposed to apply SPC e9ectively. 5lorence >1HHH?
found, for instance, that the inspection of human machine
interface specifcations should be treated as a process separate
from the inspection of application specifcations in the pro4ect he
e#amined. 7eller >;222? found that inspections of ne! and
revised code should be treated as separate processes in the
pro4ect he e#amined. , trial application of SPC is useful in
identifying homogeneous sub processes. 0ssues other than
identifying defned homogeneous processes arise in
implementing SPC. , second table presents such
implementation issues.
riteria !f "rocesses Suitable for S"
7ell"defned
Kave attributes !ith observable measures
(epetitive
SuLciently critical to 4ustify monitoring e9ort
%+ased on >)emmy 1HJH?&

S" I)-$)*&!&%o* Issus
TABLE 3.?
D+*
Procss
Consistent measurements cannot be e#pected
from soft!are processes that are not
documented and generally follo!ed.
C0oos
A--ro-r%!
&
M!surs
easures need not be e#haustive. Gne or t!o
measures that provide insight into the
performance of a process or activity are
adequate, especially if the measures are related
to the process or activity goal. easures that
can be tracked ine#pensively are preferable.
Focus o*
Procss
Tr*,s
Control charts should be constructed so as to
detect process trends, not individual
nonconforming events.
C!$cu$!&
Co*&ro$
L%)%&s
Corrc&$'
Straightfor!ard formulas e#ist for calculating
control limits and analy$ing distributions.
0ntroductory college courses in statistics usually
do not address process"control techniques in
detail.
I*As&%5!
& !*,
Ac&
SPC only signals the possible e#istence of a
problem. 7ithout detailed investigations, as in
an audit, and instituting corrective action, SPC
!ill not provide any beneft.
ProA%,
Tr!%*%*5
Problems in follo!ing the above
recommendations for implementing SPC can be
decreased !ith e9ective training. SPC training
based on e#amples of soft!are processes is to
be preferred.
%+ased on >Card 1HH@?&

R$!&%o*s0%-s &o O&0r Pr!c&%cs"

The 5igure belo! represents a high"level process architecture for
the sub4ect practice, depicting relationships among this practice and
the nature of the inMuences on the practice %describing ho! other
practices might relate to this practice&. These relationship statements
are based on defnitions of specifc <best practices= found in the
literature and the notion that the successful implementation of
practices may <inMuence= %or are inMuenced by& the ability to
successfully implement other practices. , brief description of these
inMuences is included in the table belo!.
FIGURE 3.:
"rocess Architecture for the #Statistical "rocess ontrol# $ol%
"ractice

TA&'E 3.(
Summary of )elationship *actors
INPUTS TO T2E PRACTICE
D&r)%* 30%c0
!&&r%4u&sE !& 30!&
$A$sE s0ou$, 4
co*&ro$$,

Statistical Process Control can only be
e9ective if the most critical processes are
identifed and addressed using the
technique. Practices that help establish clear
goals and decision points, and are based on
meaningful metrics and attributes based on
specifc program or technical goals, stand to
gain the most payback from using SPC. SPC
techniques need not be restricted to the
present, i.e., planning for the insertion of
ne! technology later in the life cycle should
also plan for the use of SPC to ensure that
processes are controlled and reliability of the
resulting soft!are artifacts is optimi$ed.
D+* 30&0r
*A%ro*)*& %s
!--ro-r%!& /or
-rocss co*&ro$

Practices such as Performance"+ased
Specifcations and Commercial Specifcations
NGpen System can imply the generation and
collection of data. Such data may serve as
appropriate input to SPC techniques such as
control charts. Therefore, an environment
that is data"rich provides an e#cellent
opportunity to leverage the beneft statistical
process control techniques.
ProA%, ,!&! u-o*
30%c0 ,c%s%o*s
c!* 4 4!s,

,n initial step in applying SPC is often to
discover controllable and homogeneous
processes. Past performance data can be
used for this purpose. 5ormal inspection
processes and processes for leveraging
CGTSNC)0 e#plicitly call for metrics to be
collected. These metrics can be used as the
basis for SPC.
OUTPUTS FROM T2E PRACTICE
Assss -ro5rss
&o3!r,s -rocss
co*&ro$

SPC can be used not only to control
processes, but also to determine if
quantitative requirements on soft!are
processes are being met. The results of SPC,
then, provide valuable data and information
that can be used to manage progress
to!ards achievement of soft!are
requirements. Part of this ability to manage
progress is supported by the quantitative
progress measurements that are inherent in
the SPC process, primarily in the form of
defect tracking and correction against
specifc, quantitative quality targets.
Co))u*%c!&
-ro5rss &o3!r,s
co*&ro$$%*5
-rocsss


anagement goNno"go decisions can be
based on !hether development processes
are under control. SPC presents graphical
displays supporting such decisions. The
number and types of available graphical
formats that can be used as part of the SPC
process provide accessible visibility into
progress being made to all program
stakeholders. )emonstration"based revie!s
provide an e#cellent vehicle for
communicating the progress being made in
controlling processes through the use of SPC.
I)-roA Ts&%*5
EFc%*c' !*,
EDc&%A*ss

+y providing control over soft!are
development processes, SPC !ill result in
more predictable and more reliable soft!are.
(igorous testing that is guided by
specifcations and supported by !ell"
documented and accurate operational and
usage"based models !ill be much more
e9ective under the controlled processes
resulting from SPC.
3..
D+*%&%o*s

,n application of statistics to controlling industrial processes,
including processes in soft!are development and maintenance.
Statistical Process Control %SPC& is used to identify and remove
variations in processes that e#ceed the variation to be e#pected
from natural causes.

The purpose of process control is to detect any abnormality in the
process.
" >0shika!a 1HJ;?
Sourcs (Or%5%*s o/ &0 Pr!c&%c)

7alter She!hart developed Statistical Process Control %SPC& in
the 1H;2s. She!hart sought methods applying statistics to
industrial practice. ,cceptance testing and SPC gre! out of this
!ork. She!hart proposed the use of control charts, a core technique
for SPC, in a historic internal memorandum of 1I ay 1H;@ at +ell
Telephone *aboratories.
5or a long time, SPC !as most !idely adopted in Fapan, not the
-nited States. She!hart mentored 7. Ad!ards )eming, and )eming
!ent on to introduce quality technologies into Fapanese industry.
The =/uide to Quality Control= 0shika!a >1HJ;?, frst published in
1HIJ in Fapanese, is a guide to quality control techniques that
became prevalent in Fapan after 7orld 7ar 00. Corporations in the
-nited States began adopting quality technology, including SPC,
more !idely in the 1HJ2s. (ecently, many -nited States
corporations have instituted Si# Sigma programs. These programs,
through continual process improvement, attempt to reduce the
natural variation in industrial processes.
Some began applying SPC techniques to soft!are in the 1HJ2s.
/ardiner and ontgomery >1HJO? report an e#ample. Soft!are
inspections seem to provide the processes that are most commonly
monitored !ith SPC in soft!are. Some recently proposed soft!are
process models include opportunities for SPC. The spiral lifecycle
provides a natural time for tuning soft!are processes, namely before
the start of the development of each increment. SPC yields
analy$ed data that managers can use in selecting processes to
tune. Cleanroom soft!are engineering combines incremental
development and soft!are inspections !ith other technologies, such
as reliability modeling. The Soft!are Angineering 0nstitute %SA0&
Capability aturity odel %C& mandates that SPC be used in *evel
@ organi$ations.
3.3 CONSTRUCTION OF CONTROL C2ARTS FOR VARIABLES AND
ATTRIBUTES
Co))o* T'-s o/ C0!r&s
The types of charts are often classifed according to the type of
quality characteristic that they are supposed to monitor. there are
quality control charts for variables and control charts for attributes.
Specifcally, the follo!ing charts are commonly constructed for
controlling variables.
7(4!r c0!r&. 0n this chart the sample means are plotted in order
to control the mean value of a variable %e.g., si$e of piston rings,
strength of materials, etc.&.
R c0!r&. 0n this chart, the sample ranges are plotted in order to
control the variability of a variable.
S c0!r&. 0n this chart, the sample standard deviations are
plotted in order to control the variability of a variable.
SGG. c0!r&. 0n this chart, the sample variances are plotted in
order to control the variability of a variable.
5or controlling quality characteristics that represent attributes of the
product, the follo!ing charts are commonly constructed.
C c0!r&. 0n this chart %see e#ample belo!&, !e plot the number
of defectives %per batch, per day, per machine, per 122 feet of
pipe, etc.&. This chart assumes that defects of the quality
attribute are rare, and the control limits in this chart are
computed based on the Poisson distribution %distribution of rare
events&.
FIGURE 3.<
U c0!r&. 0n this chart !e plot the rate of defectives, that is, the
number of defectives divided by the number of units inspected
%the n: e.g., feet of pipe, number of batches&. -nlike the C chart,
this chart does not require a constant number of units, and it can
be used, for e#ample, !hen the batches %samples& are of
di9erent si$es.
N- c0!r&. 0n this chart, !e plot the number of defectives %per
batch, per day, per machine& as in the C chart. Ko!ever, the
control limits in this chart are not based on the distribution of
rare events, but rather on the binomial distribution. Therefore,
this chart should be used if the occurrence of defectives is not
rare %e.g., they occur in more than 63 of the units inspected&. 5or
e#ample, !e may use this chart to control the number of units
produced !ith minor Ma!s.
P c0!r&. 0n this chart, !e plot the percent of defectives %per
batch, per day, per machine, etc.& as in the - chart. Ko!ever,
the control limits in this chart are not based on the distribution of
rare events but rather on the binomial distribution %of
proportions&. Therefore, this chart is most applicable to situations
!here the occurrence of defectives is not rare %e.g., !e e#pect
the percent of defectives to be more than 63 of the total number
of units produced&.
Control Charts for Pariables vs. Charts for ,ttributes
Sometimes, the quality control engineer has a choice bet!een
variable control charts and attribute control charts.
A,A!*&!5s o/ !&&r%4u& co*&ro$ c0!r&s. ,ttribute control charts
have the advantage of allo!ing for quick summaries of various aspects
of the quality of a product, that is, the engineer may simply classify
products as acceptable or unacceptable, based on various quality
criteria. Thus, attribute charts sometimes bypass the need for
e#pensive, precise devices and time"consuming measurement
procedures. ,lso, this type of chart tends to be more easily understood
by managers unfamiliar !ith quality control procedures: therefore, it
may provide more persuasive %to management& evidence of quality
problems.
A,A!*&!5s o/ A!r%!4$ co*&ro$ c0!r&s. Pariable control charts are
more sensitive than attribute control charts %see ontgomery, 1HJ6, p.
;2B&. Therefore, variable control charts may alert us to quality
problems before any actual 8unacceptables8 %as detected by the
attribute chart& !ill occur. ontgomery %1HJ6& calls the variable control
charts leading indicators of trouble that !ill sound an alarm before the
number of re4ects %scrap& increases in the production process.
3.1 PROCESS CAPABILITY H MEANINGE SIGNIFICANCE AND
MEASUREMENT
Procss C!-!4%$%&'
1. S$c& ! c!*,%,!& /or &0 s&u,'. This step should be
institutionali$ed. , goal of any organi$ation should be ongoing
process improvement. Ko!ever, because a company has only a
limited resource base and canDt solve all problems simultaneously, it
must set priorities for its e9orts. The tools for this include Pareto
analysis and fshbone diagrams.
;. D+* &0 -rocss. 0t is all too easy to slip into the trap of solving
the !rong problem. Gnce the candidate area has been selected in
step 1, defne the scope of the study. , process is a unique
combination of machines, tools, methods, and personnel engaged in
adding value by providing a product or service. Aach element of the
process should be identifed at this stage. This is not a trivial
e#ercise. The input of many people may be required. There are
likely to be a number of conMicting opinions about !hat the process
actually involves.
B. Procur rsourcs /or &0 s&u,'. Process capability studies
disrupt normal operations and require signifcant e#penditures of
both material and human resources. Since it is a pro4ect of ma4or
importance, it should be managed as such. ,ll of the usual pro4ect
management techniques should be brought to bear. This includes
planning, scheduling, and management status reporting.
@. EA!$u!& &0 )!sur)*& s's&). -sing the techniques
described in Chapter P, evaluate the measurement systemDs ability
to do the 4ob. ,gain, be prepared to spend the time necessary to get
a valid means of measuring the process before going ahead.
6. Pr-!r ! co*&ro$ -$!*. The purpose of the control plan is t!ofold.
1& isolate and control as many important variables as possible and,
;& provide a mechanism for tracking variables that can not be
completely controlled. The ob4ect of the capability analysis is to
determine !hat the process can do if it is operated the !ay it is
designed to be operated. This means that such obvious sources of
potential variation as operators and vendors !ill be controlled !hile
the study is conducted. 0n other !ords, a single !ell"trained
operator !ill be used and the material !ill be from a single vendor.
There are usually some variables that are important, but that are
not controllable. Gne e#ample is the ambient environment,
including temperature, barometric pressure, or humidity. Certain
process variables may degrade as part of the normal operation: for
e#ample, tools !ear and chemicals are used. These variables should
still be tracked using logsheets and similar tools.
I. S$c& ! )&0o, /or &0 !*!$'s%s. The SPC method !ill depend
on the decisions made up to this point. 0f the performance measure
is an attribute, one of the attribute charts !ill be used. Pariables
charts !ill be used for process performance measures assessed on
a continuous scale. ,lso considered !ill be the skill level of the
personnel involved, need for sensitivity, and other resources
required to collect, record, and analy$e the data.
O. G!&0r !*, !*!$'; &0 ,!&!. -se one of the control charts
described in this chapter, plus common sense. 0t is usually advisable
to have at least t!o people go over the data analysis to catch
inadvertent errors in transcribing data or performing the analysis.
J. Tr!cC ,o3* !*, r)oA s-c%!$ c!uss. , special cause of
variation may be obvious, or it may take months of investigation to
fnd it. The e9ect of the special cause may be good or bad.
(emoving a special cause that has a bad e9ect usually involves
eliminating the cause itself. 5or e#ample, if poorly trained operators
are causing variability, the special cause is the training system %not
the operator&, and it is eliminated by developing an improved
training system or a process that requires less training. Ko!ever,
the removal of a benefcial special cause may actually involve
incorporating the special cause into the normal operating
procedure. 5or e#ample, if it is discovered that materials !ith a
particular chemistry produce better product the special cause is the
ne!ly discovered material and it can be made a common cause
simply by changing the specifcation to assure that the ne!
chemistry is al!ays used.
H. Es&%)!& &0 -rocss c!-!4%$%&'. Gne point can not be
overemphasi$ed. the process capability cannot be estimated until a
state of statistical control has been achievedQ ,fter this stage has
been reached, the methods described later in this chapter may be
used. ,fter the numerical estimate of process capability has been
arrived at it must be compared to managementDs goals for the
process, or it can be used as an input into economic models.
)emingDs all"or"none rules provide a simple model that can be used
to determine if the output from a process should be sorted 1223 or
shipped as"is.
12. Es&!4$%s0 ! -$!* /or co*&%*uous -rocss %)-roA)*&.
Gnce a stable process state has been attained, steps should be
taken to maintain it and improve upon it. SPC is 4ust one means of
doing this. 5ar more important than the particular approach taken is
a company environment that makes continuous improvement a
normal part of the daily routine of everyone.
3.? SI7 SIGMA CONCEPTS OF PROCESS CAPABILITY
S%B S%5)!
The often"used si# sigma symbol.
Si# Sigma is a system of practices originally developed by
otorola to systematically improve processes by eliminating defects.
)efects are defned as units that are not members of the intended
population. Since it !as originally developed, Si# Sigma has become an
element of many Total Quality anagement %TQ& initiatives.
The process !as pioneered by +ill Smith at otorola in 1HJI and
!as originally defned as a metric for measuring defects and improving
quality, and a methodology to reduce defect levels belo! B.@ )efects
Per %one& illion Gpportunities %)PG&.
Si# Sigma is a registered service mark and trademark of
otorola, 0nc. otorola has reported over -SR1O billion in savings from
Si# Sigma as of ;22I.
0n addition to otorola, companies !hich also adopted Si# Sigma
methodologies early"on and continue to practice it today include +ank
of ,merica, Caterpillar, Koney!ell 0nternational %previously kno!n as
,llied Signal&, (aytheon and /eneral Alectric %introduced by Fack
7elch&.
(ecently Si# Sigma has been integrated !ith the T(0S
methodology for problem solving and product design.

+ey concepts of Si, Sigma
,t its core, Si# Sigma revolves around a fe! key concepts.
Critical to Quality. ,ttributes most important to the customer
)efect. 5ailing to deliver !hat the customer !ants
Process Capability. 7hat your process can deliver
Pariation. 7hat the customer sees and feels
Stable Gperations. Ansuring consistent, predictable processes to
improve !hat the customer sees and feels
)esign for Si# Sigma. )esigning to meet customer needs and
process capability
-etho%ology
Si# Sigma has t!o key methodologies.
>O?
),0C and ),)P.
),0C is used to improve an e#isting business process. ),)P is used
to create ne! product designs or process designs in such a !ay that it
results in a more predictable, mature and defect free performance.
DMAIC
+asic methodology consists of the follo!ing fve steps.
Defne the process improvement goals that are consistent !ith
customer demands and enterprise strategy.
Measure the current process and collect relevant data for future
comparison.
Analyze to verify relationship and causality of factors. )etermine
!hat the relationship is, and attempt to ensure that all factors
have been considered.
Improve or optimi$e the process based upon the analysis using
techniques like )esign of A#periments.
Control to ensure that any variances are corrected before they
result in defects. Set up pilot runs to establish process capability,
transition to production and thereafter continuously measure the
process and institute control mechanisms.
DMADV
+asic methodology consists of the follo!ing fve steps.
Defne the goals of the design activity that are consistent !ith
customer demands and enterprise strategy.
Measure and identify CTQs %critical to qualities&, product
capabilities, production process capability, and risk assessments.
Analyze to develop and design alternatives, create high"level
design and evaluate design capability to select the best design.
Design details, optimi$e the design, and plan for design
verifcation. This phase may require simulations.
Verify the design, set up pilot runs, implement production
process and handover to process o!ners.
Some people have used ),0CR %(eali$e&. Gthers contend that
focusing on the fnancial gains reali$ed through Si# Sigma is counter"
productive and that said fnancial gains are simply byproducts of a
good process improvement.
,nother additional Mavor of )esign for Si# Sigma is the )A)0
method. This process is almost e#actly like the ),)P process,
utili$ing the same toolkit, but !ith a di9erent acronym. )A)0 stands
for )efne, easure, A#plore, )evelop, 0mplement.
Quality approaches an% mo%els
)5SS %)esign for Si# Sigma& " , systematic methodology utili$ing
tools, training and measurements to enable us to design products and
processes that meet customer e#pectations and can be produced at
Si# Sigma Quality levels.
),0C %)efne, easure, ,naly$e, 0mprove and Control& " , process for
continued improvement. 0t is systematic, scientifc and fact based. This
closed"loop process eliminates unproductive steps, often focuses on
ne! measurements, and applies technology for improvement.
Si# Sigma " , vision of quality, !hich equates !ith only B.@
defects per million opportunities for each product or service
transaction. Strives for perfection.
#u!$%&' Too$s
,ssociates are e#posed to various tools and terms related to quality.
+elo! are 4ust a fe! of them.
Co*&ro$ C0!r& " onitors variance in a process over time and alerts
the business to une#pected variance !hich may cause defects.
D/c& M!sur)*& " ,ccounting for the number or frequency of
defects that cause lapses in product or service quality.
P!r&o D%!5r!) " 5ocuses our e9orts on the problems that have the
greatest potential for improvement by sho!ing relative frequency
andNor si$e in a descending bar graph. +ased on the proven Pareto
principle. ;23 of the sources cause J23 of any problems.
Procss M!--%*5 " 0llustrated description of ho! things get done,
!hich enables participants to visuali$e an entire process and identify
areas of strength and !eaknesses. 0t helps reduce cycle time and
defects !hile recogni$ing the value of individual contributions.
Roo& C!us A*!$'s%s " Study of original reason for nonconformance
!ith a process. 7hen the root cause is removed or corrected, the
nonconformance !ill be eliminated.
S&!&%s&%c!$ Procss Co*&ro$ " The application of statistical methods
to analy$e data, study and monitor process capability and
performance.
Tree )iagram " /raphically sho!s any broad goal broken into di9erent
levels of detailed actions. 0t encourages team members to e#pand their
thinking !hen creating solutions.
#u!$%&' Tr)s
B$!cC B$& " *eaders of teams responsible for measuring, analy$ing,
improving and controlling key processes that inMuence customer
satisfaction andNor productivity gro!th. +lack +elts are full"time
positions.
Co*&ro$ " The state of stability, normal variation and predictability.
Process of regulating and guiding operations and processes using
quantitative data.
CT#. Critical to Quality %Critical 8T8& " Alement of a process or practice
!hich has a direct impact on its perceived quality.
Cus&o)r N,sE EB-c&!&%o*s " Ceeds, as defned by customers,
!hich meet their basic requirements and standards.
D/c&s " Sources of customer irritation. )efects are costly to both
customers and to manufacturers or service providers. Aliminating
defects provides cost benefts.
/reen +elt " Similar to +lack +elt but not a full"time position.
M!s&r B$!cC B$& " 5irst and foremost teachers. They also revie! and
mentor +lack +elts. Selection criteria for aster +lack +elts are
quantitative skills and the ability to teach and mentor. aster +lack
+elts are full"time positions.
V!r%!*c " , change in a process or business practice that may alter
its e#pected outcome.
Statistics an% robustness
The core of the Si# Sigma methodology is a data"driven,
systematic approach to problem solving, !ith a focus on customer
impact. Statistical tools and analysis are often useful in the process.
Ko!ever, it is a mistake to vie! the core of the Si# Sigma methodology
as statistics: an acceptable Si# Sigma pro4ect can be started !ith only
rudimentary statistical tools.
Still, some professional statisticians critici$e Si# Sigma because
practitioners have highly varied levels of understanding of the
statistics involved.
Si# Sigma as a problem"solving approach has traditionally been
used in felds such as business, engineering, and production processes.
)oles re.uire% for implementation
Si# Sigma identifes fve key roles for its successful implementation.
Executive Leadership includes CAG and other key top
management team members. They are responsible for setting up
a vision for Si# Sigma implementation. They also empo!er the
other role holders !ith the freedom and resources to e#plore ne!
ideas for breakthrough improvements.
Champions are responsible for the Si# Sigma implementation
across the organi$ation in an integrated manner. The A#ecutive
*eadership dra!s them from the upper management. Champions
also act as mentor to +lack +elts. ,t /A this level of certifcation
is no! called 8Quality *eader8.
Master lac! elts, identifed by champions, act as in"house
e#pert coach for the organi$ation on Si# Sigma. They devote
1223 of their time to Si# Sigma. They assist champions and
guide +lack +elts and /reen +elts. ,part from the usual rigor of
statistics, their time is spent on ensuring integrated deployment
of Si# Sigma across various functions and departments.
Experts This level of skill is used primarily !ithin ,erospace and
)efense +usiness Sectors. A#perts !ork across company
boundaries, improving services, processes, and products for their
suppliers, their entire campuses, and for their customers.
(aytheon 0ncorporated !as one of the frst companies to
introduce A#perts to their organi$ations. ,t (aytheon, A#perts
!ork not only across multiple sites, but across business divisions,
incorporating lessons learned throughout the company.
lac! elts operate under aster +lack +elts to apply Si# Sigma
methodology to specifc pro4ects. They devote 1223 of their time
to Si# Sigma. They primarily focus on Si# Sigma pro4ect
e#ecution, !hereas Champions and aster +lack +elts focus on
identifying pro4ectsNfunctions for Si# Sigma.
"reen elts are the employees !ho take up Si# Sigma
implementation along !ith their other 4ob responsibilities. They
operate under the guidance of +lack +elts and support them in
achieving the overall results.
0n many successful modern programs, /reen +elts and +lack +elts
are empo!ered to initiate, e#pand, and lead pro4ects in their area of
responsibility. The roles as defned above, therefore, conform to the
antiquated ikel KarryN(ichard Schroeder model, !hich is far from
being universally accepted. The terms #lac! #elt and green #elt are
borro!ed from the ranking systems in various martial arts.
T0 &r) S%B S%5)!
Sigma %the lo!er"case /reek letter U& is used to represent
standard deviation %a measure of variation& of a population %lo!er"case
VsV, is an estimate, based on a sample&. The term 8si# sigma process8
comes from the notion that if one has si# standard deviations bet!een
the mean of a process and the nearest specifcation limit, he !ill make
practically no items that e#ceed the specifcations. This is the basis of
the Process Capability Study, often used by quality professionals. The
term 8Si# Sigma8 has its roots in this tool, rather than in simple process
standard deviation, !hich is also measured in sigmas. Criticism of the
tool itself, and the !ay that the term !as derived from the tool, often
sparks criticism of Si# Sigma.
The !idely accepted defnition of a si# sigma process is one that
produces B.@ defective parts per million opportunities %)PG&. ,
process that is normally distributed !ill have B.@ parts per million
beyond a point that is @.6 standard deviations above or belo! the
mean %one"sided Capability Study&. This implies that B.@ )PG
corresponds to @.6 sigmas, not si# as the process name !ould imply.
This can be confrmed by running on QuikSigma or initab a Capability
Study on data !ith a mean of 2, a standard deviation of 1, and an
upper specifcation limit of @.6. The 1.6 sigmas added to the name Si#
Sigma are arbitrary and they are called 81.6 sigma shift8 %S+T0 +lack
+elt material, ca 1HHJ&. )r. )onald 7heeler dismisses the 1.6 sigma
shift as 8goofy8.
0n a Capability Study, sigma refers to the number of standard
deviations bet!een the process mean and the nearest specifcation
limit, rather than the standard deviation of the process, !hich is also
measured in 8sigmas8. ,s process standard deviation goes up, or the
mean of the process moves a!ay from the center of the tolerance, the
Process Capability sigma number goes do!n, because fe!er standard
deviations !ill then ft bet!een the mean and the nearest specifcation
limit %see Cpk 0nde#&. The notion that, in the long term, processes
usually do not perform as !ell as they do in the short term is correct.
That requires that Process Capability sigma based on long term data is
less than or equal to an estimate based on short term sigma. Ko!ever,
the original use of the 1.6 sigma shift is as sho!n above, and implicitly
assumes the opposite.
,s sample si$e increases, the error in the estimate of standard
deviation converges much more slo!ly than the estimate of the mean
%see confdence interval&. Aven !ith a fe! do$en samples, the estimate
of standard deviation often drags an alarming amount of uncertainty
into the Capability Study calculations. 0t follo!s that estimates of
defect rates can be very greatly inMuenced by uncertainty in the
estimate of standard deviation, and that the defective parts per million
estimates produced by Capability Studies often ought not to be taken
too literally.
Astimates for the number of defective parts per million produced
also depends on kno!ing something about the shape of the
distribution from !hich the samples are dra!n. -nfortunately, there
are no means for proving that data belong to any particular
distribution. Gne can only assume normality, based on fnding no
evidence to the contrary. Astimating defective parts per million do!n
into the 122s or 12s of units based on such an assumption is !ishful
thinking, since actual defects are often deviations from normality,
!hich have been assumed not to e#ist.
T0 I1.? S%5)! Dr%/&
The W1.6 sigma drift is the drift of a process mean, !hich occurs
in all processes in a si# sigma program. 0f a product being
manufactured measures 122 W B cm %HO ' 12B cm&, over time the W1.6
sigma drift may cause the average to range up to HJ.6 " 12@.6 cm or
do!n to H6.6 " 121.6 cm. This could be of signifcance to customers.
The W1.6 shift !as introduced by ikel Karry. Karry referred to a
paper about tolerancing, the overall error in an assembly is a9ected by
the errors in components, !ritten in 1HO6 by Avans, 8Statistical
Tolerancing. The State of the ,rt. Part B. Shifts and )rifts8. Avans refers
to a paper by +ender in 1HI;, 8+enderi$ing Tolerances ' , Simple
Practical Probability ethod for Kandling Tolerances for *imit Stack
-ps8. Ke looked at the classical situation !ith a stack of disks and ho!
the overall error in the si$e of the stack, relates to errors in the
individual disks. +ased on 8probability, appro#imations and
e#perience8, +ender suggests.
Karry then took this a step further. Supposing that there is a
process in !hich 6 samples are taken every half hour and plotted on a
control chart, Karry considered the 8instantaneous8 initial 6 samples as
being 8short term8 %KarryVs nX6& and the samples throughout the day
as being 8long term8 %KarryVs gX62 points&. )ue to the random
variation in the frst 6 points, the mean of the initial sample is di9erent
to the overall mean. Karry derived a relationship bet!een the short
term and long term capability, using the equation above, to produce a
capability shift or 8S shift8 of 1.6. Gver time, the original meaning of
8short term8 and 8long term8 has been changed to result in 8long term8
drifting means.
Karry has clung tenaciously to the 81.68 but over the years, its
derivation has been modifed. 0n a recent note from Karry 87e
employed the value of 1.6 since no other empirical information !as
available at the time of reporting.8 0n other !ords, 1.6 has no! become
an empirical rather than theoretical value. , further softening from
Karry. 8... the 1.6 constant !ould not be needed as an appro#imation8.
)espite this, industry has f#ed on the idea that it is impossible to
keep processes on target. Co matter !hat is done, process means !ill
drift by W1.6 sigma. 0n other !ords, if a process has a target value of
12.2, and control limits !ork out to be 1B.2 and O.2, over the long term
the mean !ill drift to 11.6 %or J.6&, !ith control limits changing to 1@.6
and J.6.
0n truth, any process !here the mean changes by 1.6 sigma, or
any other amount, is not in statistical control. Such a change can often
be detected by a trend on a control chart. , process that is not in
control is not predictable. 0t may begin to produce defects, no matter
!here specifcation limits have been set.
D%5%&!$ S%B S%5)!
0n an e9ort to permanently minimi$e variation, otorola has
evolved the Si# Sigma methodology to use information systems tools
to make business improvements absolutely permanent. otorola calls
this e9ort Digital $ix $igma.
riticism
So) co)-!*%s &0!& 0!A )4r!c, %& 0!A ,o* -oor$'
The cartoonist Scott ,dams featured Si# Sigma in a )ilbert
cartoon published on Covember ;Ith ;22I. 7hen the process is
introduced to his company )ilbert asks 87hy donVt !e 4ump on a fad
that hasnVt already been !idely discreditedY8 The )ilbert character
states 85ortune maga$ine says... blah blah... most companies that used
Si# Sigma have trailed the SZP 622.8
)ilbert !as referring to an article in %ortune !hich stated that 8of
6J large companies that have announced Si# Sigma programs, H1
percent have trailed the SZP 622 since.8 The statement is attributed to
8an analysis by Charles Kolland of consulting frm Qualpro %!hich
espouses a competing quality"improvement process&.8
>11?
The gist of
the article is that Si# Sigma is e9ective at !hat it is intended to do, but
that it is 8narro!ly designed to f# an e#isting process8 and does not
help in 8coming up !ith ne! products or disruptive technologies.8
B!s, o* !r4r%&r!r' s&!*,!r,s
7hile B.@ defects per million might !ork !ell for certain
productsNprocesses, it might not be ideal for others. , pacemaker
might need higher standards, for e#ample, !hereas a direct mail
advertising campaign might need less. The basis and 4ustifcation for
choosing I as the number of standard deviations is not clearly
e#plained.
>citation needed?
J0!& %s S%B S%5)!K
Si# Sigma is a rigorous and disciplined methodology that uses
data and statistical analysis to measure and improve a companyVs
operational performance by identifying and eliminating 8defects8 in
manufacturing and service"related processes. Commonly defned as
B.@ defects per million opportunities, Si# Sigma can be defned and
understood at three distinct levels. metric, methodology and
philosophy...
The goal of Si# Sigma is to increase profts by eliminating variability,
defects and !aste that undermine customer loyalty.
Si# Sigma can be understoodNperceived at three levels.
1. M&r%c. B.@ )efects per illion Gpportunities. )PG allo!s you
to take comple#ity of productNprocess into account. (ule of
thumb is to consider at least three opportunities for a physical
partNcomponent " one for form, one for ft and one for function, in
absence of better considerations. ,lso you !ant to be Si# Sigma
in the Critical to Quality characteristics and not the !hole
unitNcharacteristics.
;. M&0o,o$o5'. ),0CN)5SS structured problem solving roadmap
and tools.
B. P0%$oso-0'. (educe variation in your business and take
customer"focused, data driven decisions.
Si# Sigma is a methodology that provides businesses !ith the tools
to improve the capability of their business processes. This increase in
performance and decrease in process variation leads to defect
reduction and vast improvement in profts, employee morale and
quality of product.
T0 2%s&or' o/ S%B S%5)!
The roots of Si# Sigma as a measurement standard can be traced
back to Carl 5rederick /auss %1OOO"1J66& !ho introduced the concept
of the normal curve. Si# Sigma as a measurement standard in product
variation can be traced back to the 1H;2Vs !hen 7alter She!hart
sho!ed that three sigma from the mean is the point !here a process
requires correction. any measurement standards %Cpk, Sero )efects,
etc.& later came on the scene but credit for coining the term 8Si#
Sigma8 goes to a otorola engineer named +ill Smith. %0ncidentally,
8Si# Sigma8 is a federally registered trademark of otorola&.
0n the early and mid"1HJ2s !ith Chairman +ob /alvin at the
helm, otorola engineers decided that the traditional quality levels ""
measuring defects in thousands of opportunities "" didnVt provide
enough granularities. 0nstead, they !anted to measure the defects per
million opportunities. otorola developed this ne! standard and
created the methodology and needed cultural change associated !ith
it. Si# Sigma helped otorola reali$e po!erful bottom"line results in
their organi$ation " in fact, they documented more than R1I +illion in
savings as a result of our Si# Sigma e9orts.
Since then, hundreds of companies around the !orld have
adopted Si# Sigma as a !ay of doing business. This is a direct result of
many of ,mericaVs leaders openly praising the benefts of Si# Sigma.
*eaders such as *arry +ossidy of ,llied Signal %no! Koney!ell&, and
Fack 7elch of /eneral Alectric Company. (umor has it that *arry and
Fack !ere playing golf one day and Fack bet *arry that he could
implement Si# Sigma faster and !ith greater results at /A than *arry
did at ,llied Signal. The results speak for themselves.
Si# Sigma has evolved over time. 0tVs more than 4ust a quality system
like TQ or 0SG. 0tVs a !ay of doing business. ,s /eo9 Tennant
describes in his book Si# Sigma. SPC and TQ in anufacturing and
Services. 8Si# Sigma is many things, and it !ould perhaps be easier to
list all the things that Si# Sigma quality is not. Si# Sigma can be seen
as. a vision: a philosophy: a symbol: a metric: a goal: a methodology.8
)oles re.uire% for implementation
Si# Sigma identifes fve key roles for its successful implementation.
E,ecutive 'ea%ership includes CAG and other key top
management team members. They are responsible for setting up
a vision for Si# Sigma implementation. They also empo!er the
other role holders !ith the freedom and resources to e#plore ne!
ideas for breakthrough improvements.
hampions are responsible for the Si# Sigma implementation
across the organi$ation in an integrated manner. The A#ecutive
*eadership dra!s them from the upper management. Champions
also act as mentor to +lack +elts. ,t /A this level of certifcation
is no! called 8Quality *eader8.
-aster &lac/ &elts, identifed by champions, act as in"house
e#pert coach for the organi$ation on Si# Sigma. They devote
1223 of their time to Si# Sigma. They assist champions and
guide +lack +elts and /reen +elts. ,part from the usual rigor of
statistics, their time is spent on ensuring integrated deployment
of Si# Sigma across various functions and departments.
E,perts This level of skill is used primarily !ithin ,erospace and
)efense +usiness Sectors. A#perts !ork across company
boundaries, improving services, processes, and products for their
suppliers, their entire campuses, and for their customers.
(aytheon 0ncorporated !as one of the frst companies to
introduce A#perts to their organi$ations. ,t (aytheon, A#perts
!ork not only across multiple sites, but across business divisions,
incorporating lessons learned throughout the company.
&lac/ &elts operate under aster +lack +elts to apply Si# Sigma
methodology to specifc pro4ects. They devote 1223 of their time
to Si# Sigma. They primarily focus on Si# Sigma pro4ect
e#ecution, !hereas Champions and aster +lack +elts focus on
identifying pro4ectsNfunctions for Si# Sigma.
$reen &elts are the employees !ho take up Si# Sigma
implementation along !ith their other 4ob responsibilities. They
operate under the guidance of +lack +elts and support them in
achieving the overall results.
0n many successful modern programs, Gr* B$&s !*, B$!cC
B$&s are empo!ered to initiate, e#pand, and lead pro4ects in their
area of responsibility.The terms blac/ belt !*, green belt are
borro!ed from the ranking systems in various martial arts.
So/&3!r us, /or S%B S%5)!
There are generally t!o classes of soft!are used to support Si#
Sigma. analysis tools, !hich are used to perform statistical or process
analysis, and program management tools, used to manage and track a
corporationVs entire Si# Sigma program. ,nalysis tools include
statistical soft!are such as initab, FP, SigmaE*, (ap,nalyst or
Statgraphics as !ell as process analysis tools such as i/raf#. Some
alternatives include icrosoft Pisio, Telelogic System ,rchitect, 0+
7ebSphere +usiness odeler, and Proforma Corp. ProPision. 5or
program management, tracking and reporting, the most popular tools
are 0nstantis, Po!erSteering, iCe#us and Si#Cet. Gther Si# Sigma for 0T
anagement tools include Pro#ima Technology Centauri, KP ercury,
+C (emedy.
1. Si# Sigma !as industry specifc
;. The average !as very sub4ective in nature, it !as very diLcult to
defne average
B. There !ere problems in fnding !hether si# sigma has been
achieved or not.
J0r ,%, &0 *!) LS%B S%5)!L co) /ro)K
0n my recollection, t!o recurring questions have dominated the
feld of si# sigma. The frst inquiry can be described by the global
question. <7hy Is and not some other level of capabilityY= The second
inquiry is more molecular. 0t can be summari$ed by the question.
<7here does the 1.6s shift factor come from ' and !hy 1.6 versus
some other magnitudeY= 5or details on this sub4ect, reference. <Karry,
. F. <(esolving the ysteries of Si# Sigma. Statistical Constructs and
Angineering (ationale.= 5irst Adition ;22B. Palladyne Publishing.
Phoeni#, ,ri$ona. %Cote. this particular publication !ill be available by
Gctober ;22B&. +ut until then, !e !ill consider the follo!ing thumbnail
sketch.
,t the onset of si# sigma in 1HJ6, this !riter !as !orking as an
engineer for the /overnment Alectronics /roup of otorola. +y chance
connection, 0 linked up !ith another engineer by the name of +ill Smith
%originator of the si# sigma concept in 1HJ@&. ,t that time, he
suggested otorola should require 62 percent design margins for all of
its key product performance specifcations. Statistically speaking, such
a 8safety margin8 is equivalent to a I sigma level of capability.
7hen considering the performance tolerance of a critical design
feature, he believed a ;6 percent <cushion= !as not suLcient for
absorbing a sudden shift in process centering. +ill believed the typical
shift !as on the order of 1.6s %relative to the target value&. 0n other
!ords, a four sigma level of capability !ould normally be considered
suLcient, if centered. Ko!ever, if the process center !as someho!
knocked o9 its central location %on the order of 1.6s&, the initial
capability of @s !ould be degraded to @.2s ' 1.6s X ;.6s. Gf course,
this !ould have a consequential impact on defects. 0n turn, a sudden
increase in defects !ould have an adverse e9ect on reliability. ,s
should be apparent, such a domino e9ect !ould continue straight up
the value chain.
(egardless of the shift magnitude, those of us !orking this issue
fully recogni$ed that the initial estimate of capability !ill often erode
over time in a <very natural !ay= ' thereby increasing the e#pected
rate of product defects %!hen considering a protracted period of
production&. A#tending beyond this, !e concluded that the product
defect rate !as highly correlated to the long"term process capability,
not the short"term capability. Gf course, such conclusions !ere
predicated on the statistical analysis of empirical data gathered on a
!ide array of electronic devices.
Thus, !e come to understand three things. 5irst, !e recogni$ed
that the instantaneous reproducibility of a critical"to"quality
characteristic is fully dependent on the <goodness of ft= bet!een the
operating band!idth of the process and the corresponding band!idth
of the performance specifcation. Second, the quality of that interface
can be substantively and consequentially disturbed by process
centering error. Gf course, both of these factors profoundly impact
long"term capability. Third, !e must seek to qualify our critical
processes at a Is level of short"term capability if !e are to en4oy a
long"term capbility of @s.
+y further developing these insights through applied research, !e !ere
able to greatly e#tend our understanding of the many statistical
connections bet!een such things as design margin, process capability,
defects, feld reliability, customer satisfaction, and economic success.
S&!&%s&%c!$ S%B S%5)! D+*%&%o*
Si# Sigma at many organi$ations simply means a measure of
quality that strives for near perfection. +ut the statistical implications
of a Si# Sigma program go !ell beyond the qualitative eradication of
customer"perceptible defects. 0tVs a methodology that is !ell rooted in
mathematics and statistics.
The ob4ective of Si# Sigma Quality is to reduce process output
variation so that on a long term basis, !hich is the customerVs
aggregate e#perience !ith our process over time, this !ill result in no
more than B.@ defect Parts Per illion %PP& opportunities %or B.@
)efects Per illion Gpportunities ' )PG&. 5or a process !ith only one
specifcation limit %-pper or *o!er&, this results in si# process standard
deviations bet!een the mean of the process and the customerVs
specifcation limit %hence, I Sigma&. 5or a process !ith t!o
specifcation limits %-pper and *o!er&, this translates to slightly more
than si# process standard deviations bet!een the mean and each
specifcation limit such that the total defect rate corresponds to
equivalent of si# process standard deviations.
FIGURE 3.M

any processes are prone to being inMuenced by special andNor
assignable causes that impact the overall performance of the process
relative to the customerVs specifcation. That is, the overall
performance of our process as the customer vie!s it might be B.@
)PG %corresponding to *ong Term performance of @.6 Sigma&.
Ko!ever, our process could indeed be capable of producing a near
perfect output %Short Term capability ' also kno!n as process
entitlement ' of I Sigma&. The di9erence bet!een the 8best8 a process
can be, measured by Short Term process capability, and the customerVs
aggregate e#perience %*ong Term capability& is kno!n as Shift depicted
as S
shift
or
shift
. 5or a 8typical8 process, the value of shift is 1.6:
therefore, !hen one hears about 8I Sigma,8 inherent in that statement
is that the short term capability of the process is I, the long term
capability is @.6 %B.@ )PG ' !hat the customer sees& !ith an assumed
shift of 1.6. Typically, !hen reference is given using )PG, it denotes
the *ong Term capability of the process, !hich is the customerVs
e#perience. The role of the Si# Sigma professional is to quantify the
process performance %Short Term and *ong Term capability& and based
on the true process entitlement and process shift, establish the right
strategy to reach the established performance ob4ective
,s the process sigma value increases from $ero to si#, the
variation of the process around the mean value decreases. 7ith a high
enough value of process sigma, the process approaches $ero variation
and is kno!n as V$ero defects.V
R))4r%*5 B%$$ S)%&0E F!&0r o/ S%B S%5)!
+orn in +rooklyn, Ce! Tork, in 1H;H, +ill Smith
graduated from the -.S. Caval ,cademy in 1H6; and
studied at the -niversity of innesota School of +usiness.
0n 1HJO, after !orking for nearly B6 years in engineering
and quality assurance, he 4oined otorola, serving as vice
president and senior quality assurance manager for the
*and obile Products Sector.
0n honor of SmithVs talents and dedication,
Corth!estern -niversityVs [ellogg /raduate School of
anagement established an endo!ed scholarship in SmithVs name.
)ean )onald P. Facobs of the [ellogg School notifed otorolaVs (obert
/alvin of the schoolVs intention less than a month after Smith died. 8+ill
!as an e#tremely e9ective and inspiring communicator,8 Facobs !rote
in his Fuly ;O, 1HHB, letter. 8Ke never failed to impress his audience by
the depth of his kno!ledge, the e#tent of his personal commitment,
and the level of his intellectual po!ers.8 The school created the
scholarship fund in recognition of SmithVs 8contributions to [ellogg and
his dedication to the teaching and practice of quality.8
0t !as a ftting tribute to a man !ho inMuenced business students
and corporate leaders !orld!ide !ith his innovative Si# Sigma
strategy.
,s the one !ho follo!ed most closely in his footsteps, ar4orie
Kook is !ell"positioned to speculate about +ill SmithVs take on the ;22B
version of Si# Sigma. 8Today 0 think people sometimes try to make Si#
Sigma seem complicated and overly technical,8 she said. 8Kis approach
!as, V0f you !ant to improve something, involve the people !ho are
doing the 4ob.V Ke al!ays !anted to make it simple so people !ould
use it.8
S%B S%5)! Cos&s !*, S!A%*5s
T0 +*!*c%!$ 4*+&s o/ %)-$)*&%*5 S%B S%5)! !& 'our
co)-!*' c!* 4 s%5*%+c!*&.
any people say that it takes money to make money. 0n the
!orld of Si# Sigma quality, the saying also holds true. it takes money
to save money using the Si# Sigma quality methodology. Tou canVt
e#pect to signifcantly reduce costs and increase sales using Si# Sigma
!ithout investing in training, organi$ational infrastructure and culture
evolution.
Sure you can reduce costs and increase sales in a locali$ed area
of a business using the Si# Sigma quality methodology "" and you can
probably do it ine#pensively by hiring an e#"otorola or /A +lack +elt. 0
like to think of that scenario as a 8get rich quick8 application of Si#
Sigma
8Companies of all types and si$es are in the midst of a quality
revolution. /A saved R1; billion over fve years and added R1 to its
earnings per share. Koney!ell %,lliedSignal& recorded more than RJ22
million in savings.8
8/A produces annual benefts of over R;.6 billion across the
organi$ation from Si# Sigma.8
8otorola reduced manufacturing costs by R1.@ billion from 1HJO"
1HH@.8
8Si# Sigma reportedly saved otorola R16 billion over the last 11
years.8
The above quotations may in fact be true, but pulling the
numbers out of the conte#t of the organi$ationVs revenues does
nothing to help a company fgure out if Si# Sigma is right for them. 5or
e#ample, ho! much can a R12 million or R122 million company e#pect
to saveY
0 investigated !hat the companies themselves had to say about their
Si# Sigma costs and savings "" 0 didnVt believe anything that !as
!ritten on third party !ebsites, !as estimated by 8e#perts,8 or !as
!ritten in books on the topic. 0 revie!ed literature and only captured
facts found in annual reports, !ebsite pages and presentations found
on company !ebsites.
0 investigated otorola, ,llied Signal, /A and Koney!ell. 0 choose
these four companies because they are the companies that invented
and refned Si# Sigma "" they are the most mature in their deployments
and culture changes. ,s the otorola !ebsite says, they invented it in
1HJI. ,llied Signal deployed Si# Sigma in 1HH@, /A in 1HH6. Koney!ell
!as included because ,llied Signal merged !ith Koney!ell in 1HHH
%they launched their o!n initiative in 1HHJ&. any companies have
deployed Si# Sigma bet!een the years of /A and Koney!ell "" !eVll
leave those companies for another article.
T!4$ 3.:" Co)-!*%s A*, T0 Y!r T0' I)-$)*&,
S%B S%5)!
Co)-!*' N!)
Y!r B5!* S%B
S%5)!
otorola %CTSA.GT& 1HJI
,llied Signal %erged 7ith Koney!ell in
1HHH&
1HH@
/A %CTSA./A& 1HH6
Koney!ell %CTSA.KGC& 1HHJ
5ord %CTSA.5& ;222
Table ; identifes by company, the yearly revenues, the Si# Sigma
costs %investment& per year, !here available, and the fnancial benefts
%savings&. There are many blanks, especially !here the investment is
concerned. 0Vve presented as much information as the companies have
publicly disclosed.
T!4$ 3.<" S%B S%5)! Cos& A*, S!A%*5s B' Co)-!*'
Y!r
RA*u
(NB)
I*As&,
(NB)
8
RA*u
I*As&,
S!A%*5s
(NB)
8
RA*u
S!A%*5s
Mo&oro$!
1M<9(
.>>1
3?9.M%e& ND ( 19
1
1.?
A$$%, S%5*!$
1HHJ 16.1 C) " 2.6
;
B.B
GE
1HHI OH.; 2.; 2.B 2.; 2.;
1HHO H2.J 2.@ 2.@ 1 1.1
1HHJ 122.6 2.6 2.@ 1.B 1.;
1HHH 111.I 2.I 2.6 ; 1.J
1MM9(
1MMM
3<..1 1.9 >.1 1.1
3
1..
2o*'3$$
1HHJ ;B.I C) " 2.6 ;.;
1HHH ;B.O C) " 2.I ;.6
;222 ;6.2 C) " 2.O ;.I
1MM<(
.>>>
:..3 ND ( 1.<
1
..1
For,
;222"
;22;
@B.H C) " 1
I
;.B
@'"
R+ X R +illions, -nited States
%e& X Astimated, Tearly (evenue 1HJI"1HH; Could Cot +e 5ound
C) X Cot )isclosed
Cote. Cumbers ,re (ounded To The Cearest Tenth
,lthough the complete picture of investment and savings by year
is not present, Si# Sigma savings can clearly be signifcant to a
company. The savings as a percentage of revenue vary from 1.;3 to
@.63. ,nd !hat !e can see from the /A deployment is that a company
shouldnVt e#pect more than a breakeven the frst year of
implementation. Si# Sigma is not a 8get rich quick8 methodology. 0 like
to think of it like my retirement savings plan "" Si# Sigma is a get rich
slo! methodology "" the take"a!ay point being that you !ill get rich if
you plan properly and e#ecute consistently.
,s /AVs 1HHI annual report states, 80t has been estimated that
less than Si# Sigma quality, i.e., the three"to"four Sigma levels that are
average for most -.S. companies, can cost a company as much as 12"
163 of its revenues. 5or /A, that !ould mean RJ"1; billion.8 7ith /AVs
;221 revenue of R111.I billion, this !ould translate into R11.;"1I.O
billion of savings. ,lthough R; billion !orth of savings in 1HHH is
impressive, it appears that even /A hasnVt been able to yet capture the
losses due to poor quality "" or maybe theyVre above the three"to"four
Sigma levels that are the average for most -.S. companiesY
0n either case, 1.;"@.63 of revenue is signifcant and should
catch the eye of any CAG or C5G. 5or a RB2 million a year company,
that can translate into bet!een RBI2,222 and R1,B62,222 in bottom"
line"impacting savings per year. 0t takes money to make money.
Co)-$)*&!r' Tc0*o$o5%s
0t is diLcult to concisely describe the !ays in !hich Si# Sigma
may be inter!oven !ith other initiatives %or vice versa&. The follo!ing
paragraphs broadly capture some of the possible interrelationships
bet!een initiatives.
Si# Sigma and improvement approaches such as C\, C0
S
,
PSP
S
NTSP
S
are complementary and mutually supportive. )epending
on current organi$ational, pro4ect or individual circumstances, Si#
Sigma could be an enabler to launch C
]
, C0
S
, PSP
S
, or TSP
S
.
Gr, it could be a refnement toolkitNmethodology !ithin these
initiatives. 5or instance, it might be used to select highest priority
Process ,reas !ithin C0
S
or to select highest leverage metrics
!ithin PSP
S
.
A#amination of the /oal"Question"etric %/Q&, 0nitiating"
)iagnosing"Astablishing",cting"*everaging %0)A,*
S
&, and Practical
Soft!are easurement %PS& paradigms, like!ise, sho!s compatibility
and consistency !ith Si# Sigma. /Q%0& meshes !ell !ith the )efne"
easure steps of Si# Sigma. 0)A,* and Si# Sigma share many common
features, !ith 0)A,*
S
being slightly more focused on change
management and organi$ational issues and Si# Sigma being more
focused on tactical, data"driven analysis and decision making. PS
provides a soft!are"tailored approach to measurement that may !ell
serve the Si# Sigma improvement frame!ork.
S%B S%5)! ProcssO C!-!4%$%&'
So ho! do you kno! your processes cut the mustardY 7ith Si#
Sigma, it all depends on the processD capability. Process capability is a
measure of ho! much variation or deviation occurs from !hat normally
happens to !hat is e#pected to happen. 5or e#ample, normally after
you upgrade a system, you have a !orking system. 0t you have one
piece !orking, and a couple other piece broken, !ell you no! have a
variation from !hat !as e#pected to happen. Fust to elaborate a little
further, there are three main characteristics of process capability.
The requirements are frequently a range of acceptable values.
The process is capable, !hen its variation consistently falls !ithin
that rang.
The processD sigma level is an indicator of its capability and
likelihood of meeting e#pectations.
A#panding on this concept a little bit, to assure !e all have a clearer
understanding of ho! this relates to us. The frst characteristic states
that the requirements are frequently a range of acceptable values. 5or
e#ample, the billing system is al!ays to be available !eekdays
bet!een the hours of I.22 am and I.22 pm. So our customers !ill be
satisfed !hen the system is available during these timeframes. The
problem really becomes !ith clinical systems, !hen the system
availability needs to be 1223 of the time. That is a diLcult range of
acceptable values.
The ne#t characteristic of process capability is that a process is
considered capable !hen its variation consistently falls !ithin that
range of acceptable values. [eep in mind, variation is the process
doesnDt behave as anticipated. Consider the above, if the billing
system is do!n at 1.22 pm !eekly, this is outside the range of
acceptable times. 0t is a variation, and makes the process is not
considered capable.
The fnal characteristic of process capability is the processD sigma
level. (emember, the lo!er the sigma level, the greater the variation.
, 1.2 sigma level indicates that the process has a good deal of
variation and is not meeting requirements. 0n Si# Sigma, , I.2 sigma
level is the goal
7hat 0s Si# Sigma and the 1.6 shiftY
To quote a otorola hand out from about 1HJO.
VThe performance of a product is determined by ho! much margin
e#ists bet!een the design requirement of its characteristics %and those
of its partsNsteps&, and the actual value of those characteristics. These
characteristics are produced by processes in the factory, and at the
suppliers.
Aach process attempts to reproduce its characteristics identically
from unit to unit, but !ithin each process some variation occurs. 5or
more processes, such as those !hich use real time feedback to control
outcome, the variation is quite small, and for others it may be quite
large.
, variation of the process is measured in Std. )ev, %Sigma& from
the ean. The normal variation, defned as process !idth, is ^N"B
Sigma about the mean.
,ppro#imately ;O22 parts per million partsNsteps !ill fall outside
the normal variation of ^N" B Sigma. This, by itself, does not appear
disconcerting. Ko!ever, !hen !e build a product containing 1;22
partsNsteps, !e can e#pect B.;@ defects per unit %1;22 # .22;O&, on
average. This !ould result in a rolled yield of less than @3, !hich
means fe!er than @ units out of every 122 !ould go through the entire
manufacturing process !ithout a defect. Thus, !e can see that for a
product to be built virtually defect"free, it must be designed to accept
characteristics !hich are signifcantly more than ^N" B sigma a!ay
from the mean.
0t can be sho!n that a design !hich can accept T70CA TKA
CG(,* P,(0,T0GC of the process, or ^N" I sigma, can be e#pected to
have no more than B.@ parts per million defective for each
characteristic, even if the process mean !ere to shift by as much as
^N" 1.6 sigma. 0n the same case of a product containing 1;22
partsNsteps, !e !ould no! e#pect only only 2.22@1 defects per unit
%1;22 # 2.22222B@&. This !ould mean that HHI units out of 1222 !ould
go through the entire manufacturing process !ithout a defect. To
quantify this, Capability 0nde# %Cp& is used: !here.
)esign Specifcation 7idth
Capability 0nde# Cp X
Process 7idth
, design specifcation !idth of ^N" I Sigma and a process !idth of ^N"
B Sigma yields a Cp of 1;NI X ;. Ko!ever, as sho!n in, the process
mean can shift. 7hen the process mean is shifted !ith respect to
design mean, the Capability 0nde# is ad4usted !ith a factor k, and
becomes Cpk. Cpk X Cp%1"k&, !here.
Process Shift
k 5actor
X
)esign Specifcation
7idth
The k factor for a ^N" I Sigma design !ith a 1.6 Sigma process shift .
1.6N%1;N;& or 1.6NI X 2.;6
and the
Cpk X ;%1" 2.;6&X1.6
Si# Sigma %I & is a business"driven, multi"faceted approach to
process improvement, reduced costs, and increased profts. 7ith a
fundamental principle to improve customer satisfaction by reducing
defects, its ultimate performance target is virtually defect"free
processes and products %B.@ or fe!er defective parts per million
%ppm&&. The Si# Sigma methodology, consisting of the steps 8)efne "
easure " ,naly$e " 0mprove " Control,8 is the roadmap to achieving
this goal. 7ithin this improvement frame!ork, it is the responsibility of
the improvement team to identify the process, the defnition of defect,
and the corresponding measurements. This degree of Me#ibility enables
the Si# Sigma method, along !ith its toolkit, to easily integrate !ith
e#isting models of soft!are process implementation.
Si# Sigma originated at otorola in the early 1HJ2s in response
to a CAG"driven challenge to achieve tenfold reduction in product"
failure levels in fve years. eeting this challenge required s!ift and
accurate root"cause analysis and correction. 0n the mid"1HH2s,
otorola divulged the details of their quality improvement frame!ork,
!hich has since been adopted by several large manufacturing
companies.
Tc0*%c!$ D&!%$
The primary goal of Si# Sigma is to improve customer
satisfaction, and thereby proftability, by reducing and eliminating
defects. )efects may be related to any aspect of customer satisfaction.
high product quality, schedule adherence, cost minimi$ation.
-nderlying this goal is the Taguchi *oss 5unction, !hich sho!s that
increasing defects leads to increased customer dissatisfaction and
fnancial loss. Common Si# Sigma metrics include defect rate %parts per
million or ppm&, sigma level, process capability indices, defects per
unit, and yield. any Si# Sigma metrics can be mathematically related
to the others.
The Si# Sigma drive for defect reduction, process improvement and
customer satisfaction is based on the 8statistical thinking8 paradigm
>,SQ 22?, >,S, 21?.
Averything is a process
,ll processes have inherent variability
)ata is used to understand the variability and drive process
improvement decisions
,s the roadmap for actuali$ing the statistical thinking paradigm, the
key steps in the Si# Sigma improvement frame!ork are )efne "
easure " ,naly$e " 0mprove " Control. Si# Sigma distinguishes itself
from other quality improvement programs immediately in the 8)efne8
step. 7hen a specifc Si# Sigma pro4ect is launched, the customer
satisfaction goals have likely been established and decomposed into
subgoals such as cycle time reduction, cost reduction, or defect
reduction. %This may have been done using the Si# Sigma methodology
at a businessNorgani$ational level.& The )efne stage for the specifc
pro4ect calls for baselining and benchmarking the process to be
improved, decomposing the process into manageable sub"processes,
further specifying goalsNsub"goals and establishing infrastructure to
accomplish the goals. 0t also includes an assessment of the
culturalNorgani$ational change that might be needed for success.
Gnce an e9ort or pro4ect is defned, the team methodically proceeds
through easurement, ,nalysis, 0mprovement, and Control steps. , Si#
Sigma improvement team is responsible for identifying relevant
metrics based on engineering principles and models. 7ith
dataNinformation in hand, the team then proceeds to evaluate the
dataNinformation for trends, patterns, causal relationships and 8root
cause,8 etc. 0f needed, special e#periments and modeling may be done
to confrm hypothesi$ed relationships or to understand the e#tent of
leverage of factors: but many improvement pro4ects may be
accomplished !ith the most basic statistical and non"statistical tools. 0t
is often necessary to iterate through the easure",naly$e"0mprove
steps. 7hen the target level of performance is achieved, control
measures are then established to sustain performance. , partial list of
specifc tools to support each of these steps is sho!n in 5igure.B.12
FIGURE 3.1>

,n important consideration throughout all the Si# Sigma steps is
to distinguish !hich process substeps signifcantly contribute to the
end result. The defect rate of the process, service or fnal product is
likely more sensitive to some factors than others. The analysis phase of
Si# Sigma can help identify the e#tent of improvement needed in each
substep in order to achieve the target in the fnal product. 0t is
important to remain mindful that si# sigma performance %in terms of
the ppm metric& is not required for every aspect of every process,
product and service. 0t is the goal only !here it quantitatively drives
%i.e, is a signifcant 8control knob8 for& the end result of customer
satisfaction and proftability.
The current average industry runs at four sigma, !hich
corresponds to I;12 defects per million opportunities. )epending on
the e#act defnition of 8defect8 in payroll processing, for e#ample, this
sigma level could be interpreted as I out of every 1222 paychecks
having an error. ,s 8four sigma8 is the average current performance,
there are industry sectors running above and belo! this value. 0nternal
(evenue Service %0(S& phone"in ta# advice, for instance, runs at
roughly t!o sigma, !hich corresponds to B2J,6BO errors per million
opportunities. ,gain, depending on the e#act defnition of defect, this
could be interpreted as B2 out of 122 phone calls resulting in erroneous
ta# advice. %8T!o Sigma8 performance is !here many noncompetitive
companies run.& Gn the other e#treme, domestic %-.S.& airline Might
fatality rates run at better than si# sigma, !hich could be interpreted
as fe!er than B.@ fatalities per million passengers " that is, fe!er than
2.222B@ fatalities per 122 passengers.
,s 4ust noted, Might fatality rates are 8better than si# sigma,8
!here 8si# sigma8 denotes the actual performance level rather than a
reference to the overall combination of philosophy, metric, and
improvement frame!ork. +ecause customer demands !ill likely drive
di9erent performance e#pectations, it is useful to understand the
mathematical origin of the measure and the term 8si#"sigma process.8
Conceptually, the sigma level of a process or product is !here its
customer"driven specifcations intersect !ith its distribution. ,
centered si#"sigma process has a normal distribution !ith
meanXtarget and specifcations placed I standard deviations to either
side of the mean. ,t this point, the portions of the distribution that are
beyond the specifcations contain 2.22; ppm of the data %2.221 on
each side&. Practice has sho!n that most manufacturing processes
e#perience a shift %due to drift over time& of 1.6 standard deviations so
that the mean no longer equals target. 7hen this happens in a si#"
sigma process, a larger portion of the distribution no! e#tends beyond
the specifcation limits. B.@ ppm.
5igure depicts a 1.6 "shifted distribution !ith 8I 8 annotations. 0n
manufacturing, this shift results from things such as mechanical !ear
over time and causes the si#"sigma defect rate to become B.@ ppm.
The magnitude of the shift may vary, but empirical evidence indicates
that 1.6 is about average. )oes this shift e#ist in the soft!are processY
7hile it !ill take time to build suLcient data repositories to verify this
assumption !ithin the soft!are and systems sector, it is reasonable to
presume that there are factors that !ould contribute to such a shift.
Possible e#amples are declining procedural adherence over time,
learning curve, and constantly changing tools and technologies
%hard!are and soft!are&.
FIGURE 3.11
Assu)-&%o*s"
Cormal )istribution
Process ean Shift of 1.6
from Cominal is *ikely
Process ean and Standard
)eviation are kno!n
)efects are randomly
distributed throughout units
Parts and Process Steps are
0ndependent
5or this discussion, original
nominal value X target
@'
X standard deviation
_ X center of the distribution
%shifted 1.6 from its original , on"
target location&
^N"B Z ^N"I sho! the
specifcations relative to the original
target
5igure . Si# Sigma Process !ith ean Shifted from Cominal by 1. 6
Us!5 Co*s%,r!&%o*s
0n the soft!are and systems feld, Si# Sigma may be leveraged
di9erently based on the state of the business. 0n an organi$ation
needing process consistency, Si# Sigma can help promote the
establishment of a process. 5or an organi$ation striving to streamline
their e#isting processes, Si# Sigma can be used as a refnement
mechanism.
0n organi$ations at C] level 1"B, 8defect free8 may seem an
over!helming stretch. ,ccordingly, an e9ective approach !ould be to
use the improvement frame!ork %V)efne"easure",naly$e"0mprove"
ControlV& as a roadmap to!ard intermediate defect reduction goals.
*evel 1 and ; organi$ations may fnd that adopting the Si# Sigma
philosophy and frame!ork reinforces their e9orts to launch
measurement practices: !hereas *evel B organi$ations may be able to
begin immediate use of the frame!ork. ,s organi$ations mature to
*evel @ and 6, !hich implies an ability to leverage established
measurement practices, accomplishment of true 8si# sigma8
performance %as defned by ppm defect rates& becomes a relevant
goal.
any techniques in the Si# Sigma toolkit are directly applicable
to soft!are and are already in use in the soft!are industry. 5or
instance, 8Poice of the Client8 and 8Quality 5unction )eployment8 are
useful for developing customer requirements %and are relevant
measures&. There are numerous chartingNcalculation techniques that
can be used to scrutini$e cost, schedule, and quality %pro4ect"level and
personal"level& data as a pro4ect proceeds. ,nd, for technical
development, there are quantitative methods for risk analysis and
conceptNdesign selection. The strength of 8Si# Sigma8 comes from
consciously and methodically deploying these tools in a !ay that
achieves %directly or indirectly& customer satisfaction.
,s !ith manufacturing, it is likely that Si# Sigma applications in
soft!are !ill reach beyond 8improvement of current
processesNproducts8 and e#tend to 8design of ne! processesNproducts.8
Camed 8)esign for Si# Sigma8 %)5SS&, this e#tension heavily utili$es
tools for customer requirements, risk analysis, design decision"making
and inventive problem solving. 0n the soft!are !orld, it !ould also
heavily leverage re"use libraries that consist of robustly designed
soft!are.
M!&ur%&'
Si# Sigma is rooted in fundamental statistical and business
theory: consequently, the concepts and philosophy are very mature.
,pplications of Si# Sigma methods in manufacturing, follo!ing on the
heels of many quality improvement programs, are like!ise mature.
,pplications of Si# Sigma methods in soft!are development and other
VupstreamV %from manufacturing& processes are emerging.
Cos&s !*, L%)%&!&%o*s
0nstitutionali$ing Si# Sigma into the fabric of a corporate culture
can require signifcant investment in training and infrastructure. There
are typically three di9erent levels of e#pertise cited by companies.
/reen +elt, +lack +elt Practitioner, aster +lack +elt. Aach level has
increasingly greater mastery of the skill set. (oles and responsibilities
also gro! from each level to the ne#t, !ith +lack +elt Practitioners
often in teamNpro4ect leadership roles and aster +lack +elts often in
mentoringNteaching roles. The infrastructure needed to support the Si#
Sigma environment varies. Some companies organi$e their trained
/reenN+lack +elts into a central support organi$ation. Gthers deploy
/reenN+lack +elts into organi$ations based on pro4ect needs and rely
on communities of practice to maintain cohesion.
A$&r*!&%As
0n past years, there have been many instances and evolutions of
quality improvement programs. Scrutiny of the programs !ill sho!
much similarity and also clear distinctions bet!een such programs and
Si# Sigma. Similarities include common tools and methods, concepts of
continuous improvement, and even analogous steps in the
improvement frame!ork. )i9erences have been articulated as follo!s.
Si# Sigma speaks the language of business. 0t specifcally
addresses the concept of making the business as proftable as
possible.
0n Si# Sigma, quality is not pursued independently from business
goals. Time and resources are not spent improving something
that is not a lever for improving customer satisfaction.
Si# Sigma focuses on achieving tangible results.
Si# Sigma does not include specifc integration of 0SGH22 or
alcolm +aldridge Cational Quality ,!ard criteria.
Si# Sigma uses an infrastructure of highly trained employees
from many sectors of the company %not 4ust the Quality
)epartment&. These employees are typically vie!ed as internal
change agents.
Si# Sigma raises the e#pectation from B"sigma performance to I"
sigma. Tet, it does not promote 8Sero )efects8 !hich many
people dismiss as 8impossible.8
3.9 RELIABILITY CONCEPTS H DEFINITIONSE RELIABILITY IN
SERIES AND PARALLEL
D+*%&%o*
0n general, reliability %systemic def.& is the ability of a system to
perform and maintain its functions in routine circumstances, as !ell as
hostile or une#pected circumstances.
The 0AAA defnes it as 8. . . the ability of a system or component
to perform its required functions under stated conditions for a specifed
period of time.8
0n natural language it may also denote persons !ho act
eLciently in proper momentsNcircumstances %infallibile&.
I)-or&!*c o/ R$%!4%$%&'
7hat is (eliabilityY
(eliability is a broad term that focuses on the ability of a product
to perform its intended function. athematically speaking, assuming
that an item is performing its intended function at time equals $ero,
reliability can be defned as the probability that an item !ill continue to
perform its intended function !ithout failure for a specifed period of
time under stated conditions. Please note that the product defned
here could be an electronic or mechanical hard!are product, a
soft!are product, a manufacturing process, or even a service.
7hy is (eliability 0mportantY
There are a number of reasons !hy product reliability is an important
product attribute, including.
R-u&!&%o*. , companyVs reputation is very closely related to
the reliability of their products. The more reliable a product is,
the more likely the company is to have a favorable reputation.
Cus&o)r S!&%s/!c&%o*. 7hile a reliable product may not
dramatically a9ect customer satisfaction in a positive manner, an
unreliable product !ill negatively a9ect customer satisfaction
severely. Thus high reliability is a mandatory requirement for
customer satisfaction.
J!rr!*&' Cos&s. 0f a product fails to perform its function !ithin
the !arranty period, the replacement and repair costs !ill
negatively a9ect profts, as !ell as gain un!anted negative
attention. 0ntroducing reliability analyses is an important step in
taking corrective action, ultimately leading to a product that is
more reliable.
R-!& Bus%*ss. , concentrated e9ort to!ards improved
reliability sho!s e#isting customers that a manufacturer is
serious about their product, and committed to customer
satisfaction. This type of attitude has a positive impact on future
business.
Cos& A*!$'s%s. anufacturers may take reliability data and
combine it !ith other cost information to illustrate the cost"
e9ectiveness of their products. This life cycle cost analysis can
prove that although the initial cost of their product might be
higher, the overall lifetime cost is lo!er than a competitorVs
because their product requires fe!er repairs or less
maintenance.
Cus&o)r R=u%r)*&s. any customers in todayVs market
demand that their suppliers have an e9ective reliability program.
These customers have learned the benefts of reliability analysis
from e#perience.
Co)-&%&%A A,A!*&!5. any companies !ill publish their
predicted reliability numbers to help gain an advantage over
their competition !ho either does not publish their numbers or
has lo!er numbers.
7hat is the )i9erence +et!een Quality and (eliabilityY
Aven though a product has a reliable design, !hen the product is
manufactured and used in the feld, its reliability may be
unsatisfactory. The reason for this lo! reliability may be that the
product !as poorly manufactured. So, even though the product has a
reliable design, it is e9ectively unreliable !hen felded !hich is actually
the result of a substandard manufacturing process. ,s an e#ample,
cold solder 4oints could pass initial testing at the manufacturer, but fail
in the feld as the result of thermal cycling or vibration. This type of
failure did not occur because of an improper design, but rather it is the
result of an inferior manufacturing process. So !hile this product may
have a reliable design, its quality is unacceptable because of the
manufacturing process.
Fust like a chain is only as strong as its !eakest link, a highly
reliable product is only as good as the inherent reliability of the product
and the quality of the manufacturing process.
Ko! Can 0 0mprove y ProductVs (eliabilityY
Avaluating and fnding !ays to attain high product reliability are
all aspects of reliability engineering. There are a number of types of
reliability analyses typically performed as part of this discipline.
#u!$%&' !*, R$%!4%$%&' R=u%r)*&s
Quality is associated !ith the degree of conformance of the
product to customer requirements, and thus, in a sense, !ith the
degree of customer satisfaction. 0mplicit in Fapanese quality products is
an acceptable amount of reliability: that is, the product performs its
intended function over its intended life under normal environmental
and operating conditions. (eliability assessments are incorporated
through simulation and qualifcation functions at the design and
prototyping stages. 7ith basic reliability designed in, quality control
functions are then incorporated into the production line using in"line
process controls and reduced human intervention through automation.
Since the mid"1HJ2s, Fapanese frms have found that automation leads
to improved quality in manufacturing. They have high reliability
because they control their manufacturing lines.
(eliability assurance tasks such as qualifcation are conducted
%1& during the product design phase using analytical simulation
methods and design"for"assembly soft!are, and %;& during
development using prototype or pilot hard!are. Gnce again, it is the
role of quality assurance to ensure reliability. Qualifcation includes
activities to ensure that the nominal design and manufacturing
specifcations meet the reliability targets. 0n some cases, such as the
Tamagata 5u4itsu hard disk drive plant, qualifcation of the
manufacturing processes and of the pilot lots are conducted together.
Quality conformance for qualifed products is accomplished
through monitoring and control of critical parameters !ithin the
acceptable variations already established, perhaps during qualifcation.
Quality conformance, therefore, helps to increase product yield and
consequently to lo!er product cost.
#u!$%&' Assur!*c %* E$c&ro*%c P!cC!5%*5
Fapan has a long history of taking lo!er"yield technology and
improving it. 0n the -nited States, companies change technology if
yields are considered too lo!. The continuous improvement of quad Mat
packs %Q5Ps& in contrast to the introduction of ball"grid arrays %+/,s& is
an e#ample of this di9erence. +oth countries are concerned !ith the
quality and reliability limits of fne"pitch surface mount products. The
Fapanese continue to e#cel at surface mount technologies %ST& as
they push fne"pitch development to its limits. any Fapanese
companies are no! producing Q5P !ith 2.6 mm pitch and e#pect to
introduce 2.B mm pitch packages !ithin the ne#t several years. ,s long
as current Q5P technology can be utili$ed in the latest product
introductions, the cost of manufacturing is kept lo! and current ST
production lines can be utili$ed !ith minimal investment and !ith
predictable quality and reliability results.
FapanVs leaders in ST have introduced equipment for placing
very small and fne"pitch devices, for accurate screen printing, and for
soldering. They have developed highly automated manufacturing and
assembly lines !ith a high degree of in"line quality assurance. Thus, in
terms of high"volume, rapid"turn"around, lo!"cost products, it is in their
best interests to push the limits of surface mount devices.
5urthermore, Q5Ps do not require ne! assembly methods and are
inspectable, a factor critical to ensuring quality products.
The -nited States is aggressively pursuing +/, technology:
Kitachi, ho!ever appears to be applying an on"demand approach. 0t
has introduced +/, in its recent supercomputer !ithout any quality
problems and feels comfortable in moving to ne! technology !hen it
becomes necessary. Since KitachiVs -.S. customers are demanding +/,
for computer applications, Kitachi plans to provide +/, products.
Ko!ever, )r. Gtsuka of eisei -niversity, formerly !ith Kitachi,
believes that for Fapanese customers that are still cost driven, Q5P
packages !ill reach 2.16 mm pin pitch to be competitive !ith +/, in
high"pin"count, lo!"cost applications. )r. Gtsuka believes that FapanVs
ability to continue using Q5P !ill allo! Fapan to remain the lo!"cost
electronic packaging leader for the remainder of this decade. *ike the
-nited States, Fapan is pursuing +/,, but unlike the -nited States,
Fapan is continuing to improve ST !ith confdence that it !ill meet
most cost and functional requirements through the year ;222.
atsushita and 5u4itsu are also developing bumped bare"chip
technologies to provide for continued miniaturi$ation demands.
Similar di9erences in technical concerns e#ist for !ire bonding
and kno!n good die %[/)& technologies. The -.S. Semiconductor
0ndustry ,ssociationVs roadmap suggests a technology capability limit
to !ire bonding that is not shared by the Fapanese component industry.
The Fapanese industry continues to develop ne! !ire materials and
attachment techniques that push the limits of !ire bonding
technologies. The Fapanese consider concerns !ith [/) to be a -.S.
problem caused by the lack of kno!n good assembly %[/,&: that is,
-.S. frms lack the handling and assembly capability to assemble
multiple"die packages in an automated, and thus high"quality, manner.
7ith productivity and cost reduction being the primary
manufacturing goals, increased factory automation and reduced
testing are essential strategies. ,s T)[ oLcials e#plained to the FTAC
panelists during their visit, inspection is a critical cost issue.
0t is T)[Vs Q, goal to produce only quality products !hich need
no inspection. ,t T)[, it is our goal to have no inspection at all, either
human or machine. Gur lo!est labor cost in T)[ is B; yen per minute,
or one yen every t!o seconds. 0f one multilayer semi"capacitor takes
roughly one second to produce, then it costs about 2.I yen in direct
cost. 0f someone inspects it for t!o seconds, then !e add 1.; yen in
inspection cost. That means !e have to eliminate inspection to stay
competitive. 0f !e can reduce human and machine inspection, !e can
improve profts. 0nspection does not add any value to the product.
Quality control is implemented in the manufacturing lines to ensure
that the processes stay !ithin specifed tolerances. onitoring,
verifcation, and assessment of assembly and process parameters are
integral parts of the manufacturing line. Quality control ensures that all
process variabilities beyond a specifed tolerance are identifed and
controlled.
The key focus of parameter variability appears to be in
manufacturing process parameters and human errors and
inadequacies, rather than in materials or parts. 0ncoming inspection is
negligible because of the vie! that the quality of suppliersV products
can be trusted, and perhaps more importantly because the inspection
process is not considered cost"e9ective. The global move to 0SG H222
certifcation helps guarantee supplier quality to further reduce
inspection costs.
Selection of specifc quality control methods is dictated by product
cost. Kidden costs associated !ith scheduling, handling, testing, and
production yields become critical !ith increasing global competition. ,s
more components are sourced from outside of Fapan, these cost factors
become increasingly crucial in maintaining competitive costs.
Automation an% its impact on .uality& The Fapanese have
determined that manual labor leads to poor"quality output and that
automation leads to higher"quality output. SonyVs automation activities
have reduced defect rates from ;222 to ;2 parts per million. Quality
has, therefore, become a key driver for factory automation in Fapan. 0n
addition, factory automation also adds the benefts of improving
productivity and improving Me#ibility in scheduling the production or
changeover of product types. Thus, !henever automation is cost"
e9ective, it is used to replace manual assembly, handling, testing, and
human inspection activities. This approach is applied to each ne!
product and corresponding production line that is installed. 5or
e#ample, the old printed !iring board assembly line at 5u4itsuVs
Tamagata plant used e#tensive manual inspection, !hile the ne! line
is in a clean room and is totally automated, including fnal inspection
and testing.
,ll of CippondensoVs plants have no! implemented factory"!ide
C0 systems. The system at [ota, uses factory"level data to meet
quality standards and delivery times. +oards are inserted into metal
enclosures, sealed and marked, then burned"in and tested before
shipping. Gut of several hundred thousand units produced each month,
only a couple of modules failed testing each month, according to FTACVs
hosts.
0nspection an% screening& ,s noted above, incoming inspection !as
negligible at most of the companies that the FTAC panel visited,
because of the vie! that the quality of suppliersV products could be
trusted. Since the 1H62s, the Fapanese government has set quality
requirements for any company that e#ports products from Fapan.
Suppliers have progressed in status from being fully inspected by their
customers to being fully accepted. Qualifed suppliers are no! the
standard for Fapan, and most problems come from non"Fapanese
suppliers. ,kio orita of Sony lamented that fnding quality -.S.
suppliers !as a ma4or challenge for the company. Fapanese suppliers
!ere part of the 8virtual8 company, !ith strong customer ties and a
commitment to help customers succeed.
Components !ere not being screened at any of the printed
!iring board %P7+& assembly, hard disk drive, or product assembly
plants visited by the FTAC panel. )efects are seldom found in !ell"
controlled and highly automated assembly lines. 7here specifc
problems are found, tailored screens are implemented to address
specifc failure mechanisms at the board or product assembly level. 5or
e#ample, 5u4itsu noted that todayVs components do not require burn"in,
although at the board level it conducts some burn"in to detect solder
bridges that occur during board assembly. +ut !ith the increasing cost
of Fapanese labor, the greatest pressure is to avoid unnecessary
testing activities. Suppliers simply have to meet quality conformance
standards to keep customers satisfed. *ack of conformance to
requirements !ould be considered noncompetitive.
7ith reliable components, assemblers must concentrate their
e9orts on the assembly process. 7ithin a companyVs o!n production
lines, automated inspection is central to factory automation activities.
Glder lines, like the B1N;"inch disk drive line the panel sa! at 5u4itsu,
have e#tensive 1223 manual inspection of P7+s. 5u4itsuVs ne! line has
fully automated inspection and testing. ,t 0biden, automated
inspection is part of the automated manufacturing process as a
technique for alignment and assembly as !ell as for tolerance
assessment and defect detection. icroscopic mechanical
dimensioning is conducted on a sample basis. The ne!er the line, the
greater the automation of inspection and testing.
R$%!4%$%&' %* E$c&ro*%c P!cC!5%*5
0n terms of reliability, the Fapanese proactively develop good
design, using simulation and prototype qualifcation, that is based on
advanced materials and packaging technologies. 0nstead of using
military standards, most companies use internal commercial best
practices. ost reliability problems are treated as materials or process
problems. (eliability prediction methods using models such as il"
Kdbk";1O are not used. 0nstead, Fapanese frms focus on the 8physics
of failure8 by fnding alternative materials or improved processes to
eliminate the source of the reliability problem. The factories visited by
the FTAC panel are !ell equipped to address these types of problems.
Assessment metho%s& Fapanese frms identify the areas that need
improvement for competitive reasons and target those areas for
improvement. They donVt try to f# everything: they are very specifc.
They continuously design products for reduced si$e and cost and use
ne! technologies only !hen performance problems arise. ,s a result,
most kno!n technologies have predictable reliability characteristics.
0nfrastructure. The incorporation of suppliers and customers early in
the product development cycle has given Fapanese companies an
advantage in rapid development of components and in e9ective design
of products. This is the Fapanese approach to concurrent engineering
and is a standard approach used by the companies the FTAC panel
visited. The utili$ation of soft!are tools like design for assem#ly allo!s
for rapid design and is an integral part of the design teamVs activities.
,t the time of the panelVs visit, design for disassem#ly !as becoming a
requirement for markets such as /ermany. Suppliers are e#pected to
make required investments to provide the needed components for ne!
product designs. ,dvanced factory automation is included in the
design of ne! factories.
'raining& The Fapanese vie! of training is best e#emplifed by
Cippondenso. The company runs its o!n t!o"year college to train
production !orkers. anagers tend to hold four"year degrees from
university engineering programs. Practical training in areas such as
equipment design takes place almost entirely !ithin the company.
)uring the frst si# years of employment, engineers each receive 122
hours per year of formal technical training. 0n the si#th year, about
123 of the engineers are selected for e#tended education and receive
;22 hours per year of technical training. ,fter ten years about 13 are
selected to become future e#ecutives and receive additional education.
+y this time, employees have earned the equivalent of a Ph.). degree
!ithin the company. anagement and business training is also
provided for technical managers. 0n nonengineering felds, the fraction
that become managers is perhaps 123.
0biden uses 8one"minute8 and safety training sessions in every
manufacturing sector. 8Gne"minute8 discussions are held by section
leaders and !orkers using visual aids that are available in each
section. The sub4ects are specifc to facets of the 4ob like the correct
!ay to use a tool or details about a specifc step in the process. The
daily events are intended to e#pose !orkers to additional kno!ledge
and continuous training. ,s a consequence, !orkers assure that
production criteria are met. 0biden also employs a quality patrol that
fnds and displays e#amples of poor quality on large bulletin boards
throughout the plant. A#hibits the panel sa! included anything from
pictures of components or board lots sitting around in corners, to
damaged !alls and Moors, to $iplock bags full of dust and dirt.
The factory& Fapanese factories pay attention to running equipment
!ell, to continuous improvement, to cost reduction, and to !aste
elimination. Total preventive maintenance %TP& is a methodology to
ensure that equipment operates at its most eLcient level and that
facilities are kept clean so as not to contribute to reliability problems.
0n fact, the Fapan anagement ,ssociation gives annual TP a!ards
!ith prestige similar to the )eming Pri$e, and receipt of those a!ards
is considered a required step for companies that !ish to attain the
Fapan Quality Pri$e. Co structured quality or reliability techniques are
used " 4ust detailed studies of operations, and automated, smooth"
running, eLcient production.
Safety concerns appeared to the FTAC panel to be secondary to
eLciency considerations. 7hile Moor markings and signs direct !orkers
to stay a!ay from equipment, fe! barriers keep individuals a!ay from
equipment. 0n the ne!est production lines, sensors are used to !arn
individuals !ho penetrate into machine space, and the sensors even
stop machines if individuals approach too close. 5actories provide
!orkers !ith masks and hats rather than safety protection like eye
!ear. 0n most Fapanese factories, street shoes are not allo!ed.
ost electronic frms the panel visited !ere in the process of meeting
ne! environmental guidelines. 5u4itsu removed C5Cs from its cleaning
processes in Gctober 1HHB. C5Cs !ere replaced by a deioni$ed"!ater
cleaning process. 0n the old assembly process, the amount of handling
required for inspection reduced the impact of cleaning. The ne! line
had no such problems.
To provide high reliability, Fapanese frms create ne! products
using fe!er components, more automation, and Me#ible manufacturing
technologies. 5or e#ample, T)[ is striving for ;@"hour, nonassisted,
Me#ible circuit card manufacturing using state"of"the"art high"density
surface mounting techniques and integrated multifunction composite
chips. 0t has developed true microcircuit miniaturi$ation technologies
that integrate BB active and passive components on one chip. This !ill
reduce the number of components required by customers during board
assembly, thereby reducing potential assembly defects.
0n addition, the application of materials and process kno!"ho!
provides a fundamental competitive advantage in manufacturing
products !ith improved quality characteristics. Citto )enko, for
e#ample, has developed lo!"dust pellets for use in molding
compounds. 0biden has developed an epo#y hardener to enhance peel
strength, thus improving reliability of its plating technology. The ne!
process reduces cracking in the high"stress areas of small vias. 0biden
also uses epo#y dielectric for cost reduction and enhanced thermal
conductivity of its C") substrate. ,t the time of the FTAC visit, the
company !as also attempting to reduce solder resist height in an e9ort
to improve the quality and ease of additive board assembly. 0t believes
that a product !ith a resist ;2 mils higher than the copper trace can
eliminate solder bridging. Sony developed adhesive bonding
technologies in order to improve the reliability and automation of its
optical pickup head assembly. 0t set the parameters for surface
preparation, bonding agents, and process controls. Sony used light ray
cleaning to improve surface !etability and selected nine di9erent
bonding agents for 4oining various components in the pickup head. 0t
no! produces some I23 of the !orldVs optical pickup assemblies. The
continuous move to miniaturi$ation !ill keep the pressure on Fapanese
frms to further develop both their materials and process capabilities.
3.: PRODUCT LIFE C2ARACTERISTICS CURVE
3.< TOTAL PRODUCTIVE MAINTENANCE (TMP)E RELEVANCE TO
T#M
J0!& %s To&!$ Pro,uc&%A M!%*&*!*c (TPM)K
0t can be considered as the medical science of machines& Total
Productive aintenance %TP& is a maintenance program !hich
involves a ne!ly defned concept for maintaining plants and
equipment. The goal of the TP program is to markedly increase
production !hile, at the same time, increasing employee morale and
4ob satisfaction.
TP brings maintenance into focus as a necessary and vitally
important part of the business. 0t is no longer regarded as a non"proft
activity. )o!n time for maintenance is scheduled as a part of the
manufacturing day and, in some cases, as an integral part of the
manufacturing process. The goal is to hold emergency and
unscheduled maintenance to a minimum.
J0' TPM K
TP !as introduced to achieve the follo!ing ob4ectives. The
important ones are listed belo!.
,void !astage in a quickly changing economic environment.
Producing goods !ithout reducing product quality.
(educe cost.
Produce a lo! batch quantity at the earliest possible time.
/oods send to the customers must be non defective.
S%)%$!r%&%s !*, ,%Dr*cs 4&3* T#M !*, TPM
The TP program closely resembles the popular Total Quality
anagement %TQ& program. any of the tools such as employee
empo!erment, benchmarking, documentation, etc. used in TQ are
used to implement and optimi$e TP.5ollo!ing are the similarities
bet!een the t!o.
1. Total commitment to the program by upper level management is
required in both programmes
;. Amployees must be empo!ered to initiate corrective action, and
B. , long range outlook must be accepted as TP may take a year
or more to implement and is an on"going process. Changes in
employee mind"set to!ard their 4ob responsibilities must take
place as !ell.
The di9erences bet!een TQ and TP is summari$ed belo!.
TABLE 3.M
C!&5or' T#M TPM
(#)ect
Quality % Gutput and
e9ects &
Aquipment % 0nput and
cause &
Mains of
attaining goal
Systemati$e the
management. 0t is
soft!are oriented
Amployees participation
and it is hard!are
oriented
'arget Quality for PP
Alimination of losses and
!astes.
T'-s o/ )!%*&*!*c
1. Br!C,o3* )!%*&*!*c
0t means that people !aits until equipment fails and repair it. Such a
thing could be used !hen the equipment failure does not signifcantly
a9ect the operation or production or generate any signifcant loss
other than repair cost.
.. PrA*&%A )!%*&*!*c ( 1M?1 )
0t is a daily maintenance % cleaning, inspection, oiling and re"tightening
&, design to retain the healthy condition of equipment and prevent
failure through the prevention of deterioration, periodic inspection or
equipment condition diagnosis, to measure deterioration. 0t is further
divided into periodic maintenance and predictive maintenance. Fust like
human life is e#tended by preventive medicine, the equipment service
life can be prolonged by doing preventive maintenance.
.!. Pr%o,%c )!%*&*!*c ( T%) 4!s, )!%*&*!*c ( TBM)
Time based maintenance consists of periodically inspecting, servicing and cleaning
equipment and replacing parts to prevent sudden failure and process problems.
.4. Pr,%c&%A )!%*&*!*c
This is a method in !hich the service life of important part is
predicted based on inspection or diagnosis, in order to use the parts to
the limit of their service life. Compared to periodic maintenance,
predictive maintenance is condition based maintenance. 0t manages
trend values, by measuring and analy$ing data about deterioration and
employs a surveillance system, designed to monitor conditions through
an on"line system.
3. Corrc&%A )!%*&*!*c ( 1M?: )
0t improves equipment and its components so that preventive
maintenance can be carried out reliably. Aquipment !ith design
!eakness must be redesigned to improve reliability or improving
maintainability
1. M!%*&*!*c -rA*&%o* ( 1M9> )
0t indicates the design of a ne! equipment. 7eakness of current
machines are suLciently studied % on site information leading to failure
prevention, easier maintenance and prevents of defects, safety and
ease of manufacturing & and are incorporated before commissioning a
ne! equipment.
TPM ( 2%s&or'
TP is a innovative Fapanese concept. The origin of TP can be
traced back to 1H61 !hen preventive maintenance !as introduced in
Fapan. Ko!ever the concept of preventive maintenance !as taken from
-S,. Cippondenso !as the frst company to introduce plant !ide
preventive maintenance in 1HI2. Preventive maintenance is the
concept !herein, operators produced goods using machines and the
maintenance group !as dedicated !ith !ork of maintaining those
machines, ho!ever !ith the automation of Cippondenso, maintenance
became a problem as more maintenance personnel !ere required. So
the management decided that the routine maintenance of equipment
!ould be carried out by the operators. % This is ,utonomous
maintenance, one of the features of TP &. aintenance group took up
only essential maintenance !orks.
Thus Cippondenso !hich already follo!ed preventive maintenance also
added ,utonomous maintenance done by production operators. The
maintenance cre! !ent in the equipment modifcation for improving
reliability. The modifcations !ere made or incorporated in ne!
equipment. This lead to maintenance prevention. Thus preventive
maintenance along !ith Maintenance prevention and Maintaina#ility
Improvement gave birth to "ro%uctive maintenance. The aim of
productive maintenance !as to ma#imi$e plant and equipment
e9ectiveness to achieve optimum life cycle cost of production
equipment.
+y then Cippon )enso had made quality circles, involving the
employees participation. Thus all employees took part in implementing
Productive maintenance. +ased on these developments Cippondenso
!as a!arded the distinguished plant pri$e for developing and
implementing TP, by the *apanese Institute of +lant Engineers % F0PA &.
Thus Cippondenso of the Toyota group became the frst company to
obtain the TP certifcation.
TPM T!r5&s"
P
Gbtain inimum J23 GPA.
Gbtain inimum H23 GAA % Gverall Aquipment A9ectiveness &
(un the machines even during lunch. % *unch is for operators and not
for machinesQ&
Q
Gperate in a manner, so that there are no customer complaints.
C
(educe the manufacturing cost by B23.
)
,chieve 1223 success in delivering the goods as required by the
customer.
S
aintain a accident free environment.

0ncrease the suggestions by B times. )evelop ulti"skilled and Me#ible
!orkers.
TABLE 3.1>
-otives of
T"-
1. ,doption of life cycle approach for
improving the overall performance of
production equipment.
;. 0mproving productivity by highly motivated
!orkers !hich is achieved by 4ob
enlargement.
B. The use of voluntary small group activities
for identifying the cause of failure, possible
plant and equipment modifcations.
1ni.ueness
of T"-
The ma4or di9erence bet!een TP and other
concepts is that the operators are also made to
involve in the maintenance process. The concept
of ,I - +roduction operators . (perate/ 0ou
- Maintenance department . fx, is not follo!ed.
T"-
!b2ectives
1. ,chieve Sero )efects, Sero +reakdo!n and
Sero accidents in all functional areas of the
organi$ation.
;. 0nvolve people in all levels of organi$ation.
B. 5orm di9erent teams to reduce defects and
Self aintenance.
3irect
bene4ts of
T"-
1. 0ncrease productivity and GPA % Gverall
Plant ALciency & by 1.6 or ; times.
;. (ectify customer complaints.
B. (educethe manufacturing cost by B23.
@. Satisfy the customers needs by 122 3
% )elivering the right quantity at the right
time, in the required quality. &
6. (educe accidents.
I. 5ollo! pollution control measures.
0n%irect
bene4ts of
T"-
1. Kigher confdence level among the
employees.
;. [eep the !ork place clean, neat and
attractive.
B. 5avorablechange in the attitude of the
operators.
@. ,chieve goals by !orking as team.
6. Kori$ontaldeployment of a ne! concept in
all areas of the organi$ation.
I. Share kno!ledge and e#perience.
O. The !orkers get a feeling of o!ning the
machine.
!EE 5 !verall E.uipment E6ciency 7 :
!EE 8 A , "E , Q
A 9 Availability of the machine. ,vailability is proportion of time
machine is actually available out of time it should be available.
, X % T+5 " TT( & N T+5.
T+5 " ean Time +et!een 5ailures X % Total (unning Time & N Cumber
of 5ailures.
TT( " ean Time To (epair.
+E 1 +erformance E2ciency. 0t is given by (A E SA.
)ate e6ciency 5)E7 " ,ctual average cycle time is slo!er than
design cycle time because of 4ams, etc. Gutput is reduced because of
4ams
Spee% e6ciency 5SE7 . ,ctual cycle time is slo!er than design cycle
time machine output is reduced because it is running at reduced
speed.
Q 9 )efers to .uality rate& 7hich is percentage of good parts out of
total produced sometimes called 8yield8.
S&-s %* %*&ro,uc&%o* o/ TPM %* ! or5!*%;!&%o* "
S&- A ( PREPARATORY STAGE "
STEP 1 ( A**ou*c)*& 4' M!*!5)*& &o !$$ !4ou& TPM
%*&ro,uc&%o* %* &0 or5!*%;!&%o* "
Proper understanding, commitment and active involvement of
the top management in needed for this step. Senior management
should have a!areness programmes, after !hich announcement is
made to all. Publish it in the house maga$ine and put it in the notice
board. Send a letter to all concerned individuals if required.
STEP . ( I*%&%!$ ,uc!&%o* !*, -ro-!5!*,! /or TPM "
Training is to be done based on the need. Some need intensive
training and some 4ust an a!areness. Take people !ho matters to
places !here TP already successfully implemented.
STEP 3 ( S&&%*5 u- TPM !*, ,-!r&)*&!$ co))%&&s "
TPM includes improvement, autonomous maintenance, quality maintenance etc.,
as part of it. When committees are set up it should take care of all those needs.
STEP 1 ( Es&!4$%s0%*5 &0 TPM 3orC%*5 s's&) !*, &!r5& "
Co! each area is benchmarked and f# up a target for achievement.
STEP ? ( A )!s&r -$!* /or %*s&%&u&%o*!$%;%*5 "
Ce#t step is implementation leading to institutionali$ing !herein
TP becomes an organi$ational culture. ,chieving P a!ard is the
proof of reaching a satisfactory level.
STEP B ( INTRODUCTION STAGE
This is a ceremony and !e should invite all. Suppliers as they
should kno! that !e !ant quality supply from them. (elated
companies and aLliated companies !ho can be our customers, sisters
concerns etc. Some may learn from us and some can help us and
customers !ill get the communication from us that !e care for quality
output.
STAGE C ( IMPLEMENTATION
0n this stage eight activities are carried !hich are called eight
pillars in the development of TP activity.
Gf these four activities are for establishing the system for
production eLciency, one for initial control system of ne! products
and equipment, one for improving the eLciency of administration and
are for control of safety, sanitation as !orking environment.
STAGE D ( INSTITUTIONALISING STAGE
+y all there activities one !ould has reached maturity stage. Co!
is the time for applying for P a!ard. ,lso think of challenging level to
!hich you can take this movement.
Organization Structure for TPM Implementation :
FIGURE 3.12
FIGURE 3.13
"illars of T"-
PILLAR 1 ( ?S "
TP starts !ith 6S. Problems cannot be clearly seen !hen the !ork
place is unorgani$ed. Cleaning and organi$ing the !orkplace helps the
team to uncover problems. aking problems visible is the frst step of
improvement.
TABLE 3. 11
J!-!*s Tr)
E*5$%s0
Tr!*s$!&%o*
E=u%A!$*& OSO
&r)
$eiri Grganisation Sort
$eiton Tidiness Systematise
$eiso Cleaning S!eep
$ei!etsu Standardisation Standardise
$hitsu!e )iscipline Self " )iscipline
SEIRI ( Sor& ou& "
This means sorting and organi$ing the items as critical,
important, frequently used items, useless, or items that are not need
as of no!. -n!anted items can be salvaged. Critical items should be
kept for use nearby and items that are not be used in near future,
should be stored in some place. %or this step/ the 3orth of the item
should #e decided #ased on utility and not cost. ,s a result of this step,
the search time is reduced.
TABLE 3.1.
Pr%or%&' Fr=u*c' o/ Us 2o3 &o us
Lo3
*ess than once per year,
Gnce per year`
Thro! a!ay, Store a!ay
from the !orkplace
Average
,t least ;NI months, Gnce
per month, Gnce per
!eek
Store together but oaine
4igh Gnce Per )ay *ocate at the !orkplace
SEITON ( Or5!*%s "
The concept here is that 8Each items has a place/ and only one
place8. The items should be placed back after usage at the same place.
To identify items easily, name plates and colored tags has to be used.
Pertical racks can be used for this purpose, and heavy items occupy
the bottom position in the racks.
SEISO ( S0%* &0 3orC-$!c "
This involves cleaning the !ork place free of burrs, grease, oil,
!aste, scrap etc. Co loosely hanging !ires or oil leakage from
machines.
SEI@ETSU ( S&!*,!r,%;!&%o* "
Amployees has to discuss together and decide on standards for
keeping the !ork place N achines N path!ays neat and clean. This
standards are implemented for !hole organi$ation and are tested N
0nspected randomly.
S2ITSU@E ( S$/ ,%sc%-$%* "
Considering 6S as a !ay of life and bring about self"discipline
among the employees of the organi$ation. This includes !earing
badges, follo!ing !ork procedures, punctuality, dedication to the
organi$ation etc.
PILLAR . ( JIS2U 2OPEN ( Au&o*o)ous )!%*&*!*c ) "
This pillar is geared to!ards developing operators to be able to
take care of small maintenance tasks, thus freeing up the skilled
maintenance people to spend time on more value added activity and
technical repairs. The operators are responsible for upkeep of their
equipment to prevent it from deteriorating.
Po$%c' "
1. -ninterrupted operation of equipments.
;. 5le#ible operators to operate and maintain other equipments.
B. Aliminating the defects at source through active employee
participation.
@. Step!ise implementation of FK activities.
JIS2U 2OPEN T!r5&s"
1. Prevent the occurrence of 1, N 1+ because of FK.
;. (educe oil consumption by 623
B. (educe process time by 623
@. 0ncrease use of FK by 623
S&-s %* JIS2U 2OPEN "
1. Preparation of employees.
;. 0nitial cleanup of machines.
B. Take counter measures
@. 5i# tentative FK standards
6. /eneral inspection
I. ,utonomous inspection
O. Standardi$ation and
J. ,utonomous management.
Aach of the above mentioned steps is discussed in detail belo!.
1. Train the Amployees . Aducate the employees about TP, 0ts
advantages, FK advantages and Steps in FK. Aducate the
employees about abnormalities in equipments.
;. 0nitial cleanup of machines .
o Supervisor and technician should discuss and set a date for
implementing step1
o ,rrange all items needed for cleaning
o Gn the arranged date, employees should clean the
equipment completely !ith the help of maintenance
department.
o )ust, stains, oils and grease has to be removed.
o 5ollo!ing are the things that has to be taken care !hile
cleaning. They are Gil leakage, loose !ires, unfastened nits
and bolts and !orn out parts.
o ,fter clean up problems are categori$ed and suitably
tagged. 7hite tags is place !here problems can be solved
by operators. Pink tag is placed !here the aid of
maintenance department is needed.
o Contents of tag is transferred to a register.
o ake note of area !hich !ere inaccessible.
o 5inally close the open parts of the machine and run the
machine.
B. Counter easures .
o 0naccessible regions had to be reached easily. A.g. 0f there
are many scre! to open a My !heel door, hinge door can
be used. 0nstead of opening a door for inspecting the
machine, acrylic sheets can be used.
o To prevent !ork out of machine parts necessary action
must be taken.
o achine parts should be modifed to prevent accumulation
of dirt and dust.
@. Tentative Standard .
o FK schedule has to be made and follo!ed strictly.
o Schedule should be made regarding cleaning, inspection
and lubrication and it also should include details like !hen,
!hat and ho!.
6. /eneral 0nspection .
o The employees are trained in disciplines like Pneumatics,
electrical, hydraulics, lubricant and coolant, drives, bolts,
nuts and Safety.
o This is necessary to improve the technical skills of
employees and to use inspection manuals correctly.
o ,fter acquiring this ne! kno!ledge the employees should
share this !ith others.
o +y acquiring this ne! technical kno!ledge, the operators
are no! !ell a!are of machine parts.
I. ,utonomous 0nspection .
o Ce! methods of cleaning and lubricating are used.
o Aach employee prepares his o!n autonomous chart N
schedule in consultation !ith supervisor.
o Parts !hich have never given any problem or part !hich
donVt need any inspection are removed from list
permanently based on e#perience.
o 0ncluding good quality machine parts. This avoid defects
due to poor FK.
o 0nspection that is made in preventive maintenance is
included in FK.
o The frequency of cleanup and inspection is reduced based
on e#perience.
O. Standardi$ation .
o -pto the previous stem only the machinery N equipment
!as the concentration. Ko!ever in this step the
surroundings of machinery are organi$ed. Cecessary items
should be organi$ed, such that there is no searching and
searching time is reduced.
o 7ork environment is modifed such that there is no
diLculty in getting any item.
o Averybody should follo! the !ork instructions strictly.
o Cecessary spares for equipments is planned and procured.
J. ,utonomous anagement .
o GAA and GPA and other TP targets must be achieved by
continuous improve through [ai$en.
o P)C, % Plan, )o, Check and ,ct & cycle must be
implemented for [ai$en.
PILLAR 3 ( @AIPEN "
8[ai8 means change, and 8Sen8 means good % for the better &.
+asically kai$en is for small improvements, but carried out on a
continual basis and involve all people in the organi$ation. [ai$en is
opposite to big spectacular innovations. [ai$en requires no or little
investment. The principle behind is that 8a very large number of small
improvements are move e9ective in an organi$ational environment
than a fe! improvements of large value. This pillar is aimed at
reducing losses in the !orkplace that a9ect our eLciencies. +y using a
detailed and thorough procedure !e eliminate losses in a systematic
method using various [ai$en tools. These activities are not limited to
production areas and can be implemented in administrative areas as
!ell.
@!%;* Po$%c' "
1. Practice concepts of $ero losses in every sphere of activity.
;. relentless pursuit to achieve cost reduction targets in all
resources
B. (elentless pursuit to improve over all plant equipment
e9ectiveness.
@. A#tensive use of P analysis as a tool for eliminating losses.
6. 5ocus of easy handling of operators.
@!%;* T!r5& "
,chieve and sustain $ero loses !ith respect to minor stops,
measurement and ad4ustments, defects and unavoidable do!ntimes. 0t
also aims to achieve B23 manufacturing cost reduction.
Too$s us, %* @!%;* "
1. P analysis
;. 7hy " 7hy analysis
B. Summary of losses
@. [ai$en register
6. [ai$en summary sheet.
The ob4ective of TP is ma#imi$ation of equipment e9ectiveness.
TP aims at ma#imi$ation of machine utili$ation and not merely
machine availability ma#imi$ation. ,s one of the pillars of TP
activities, [ai$en pursues eLcient equipment, operator and material
and energy utili$ation, that is e#tremes of productivity and aims at
achieving substantial e9ects. [ai$en activities try to thoroughly
eliminate 1I ma4or losses.
19 M!Qor $osss %* ! or5!*%s!&%o*"
TABLE 3.13
'oss ategory
1. 5ailure losses "
+reakdo!n loss
;. Setup N ad4ustment
losses
B. Cutting blade loss
@. Start up loss
6. inor stoppage N 0dling
loss.
I. Speed loss " operating at
lo! speeds.
O. )efect N re!ork loss
J. Scheduled do!ntime
loss
*osses that impede equipment
eLciency
H. anagement loss
12. Gperating motion
loss
*oses that impede human !ork
eLciency
11. *ine organi$ation
loss
1;. *ogistic loss
1B. easurement and
ad4ustment loss
1@. Anergy loss
16. )ie, 4ig and tool
breakage loss
1I. Tield loss.
*oses that impede e9ective use of
production resources
C$!ss%+c!&%o* o/ $osss "
TABLE 3.14
Aspect Spora%ic 'oss hronic 'oss
Causation
Causes for this failure
can be easily traced.
Cause"e9ect
relationship is simple to
trace.
This loss cannot be
easily identifed and
solved. Aven if various
counter measures are
applied
(emedy
Aasy to establish a
remedial measure
This type of losses are
caused because of
hidden defects in
machine, equipment
and methods.
0mpact N *oss
, single loss can be
costly
, single cause is rare " a
combination of causes
trends to be a rule
5requency of
occurrence
The frequency of
occurrence is lo! and
occasional.
The frequency of loss is
more.
Corrective
action
-sually the line
personnel in the
production can attend
to this problem.
Specialists in process
engineering, quality
assurance and
maintenance people are
required.
PILLAR 1 ( PLANNED MAINTENANCE "
0t is aimed to have trouble free machines and equipments producing
defect free products for total customer satisfaction. This breaks
maintenance do!n into @ 8families8 or groups !hich !as defned
earlier.
1. Preventive aintenance
;. +reakdo!n aintenance
B. Corrective aintenance
@. aintenance Prevention
7ith Planned aintenance !e evolve our e9orts from a reactive to a
proactive method and use trained maintenance sta9 to help train the
operators to better maintain their equipment.
Po$%c' "
1. ,chieve and sustain availability of machines
;. Gptimum maintenance cost.
B. (educes spares inventory.
@. 0mprove reliability and maintainability of machines.
T!r5& "
1. Sero equipment failure and break do!n.
;. 0mprove reliability and maintainability by 62 3
B. (educe maintenance cost by ;2 3
@. Ansure availability of spares all the time.
S%B s&-s %* P$!**, )!%*&*!*c "
1. Aquipment evaluation and recoding present status.
;. (estore deterioration and improve !eakness.
B. +uilding up information management system.
@. Prepare time based information system, select equipment, parts
and members and map out plan.
6. Prepare predictive maintenance system by introducing
equipment diagnostic techniques and
I. Avaluation of planned maintenance.
PILLAR ? ( #UALITY MAINTENANCE "
0t is aimed to!ards customer delight through highest quality
through defect free manufacturing. 5ocus is on eliminating non"
conformances in a systematic manner, much like 5ocused
0mprovement. 7e gain understanding of !hat parts of the equipment
a9ect product quality and begin to eliminate current quality concerns,
then move to potential quality concerns. Transition is from reactive to
proactive %Quality Control to Quality ,ssurance&.
Q activities is to set equipment conditions that preclude quality
defects, based on the basic concept of maintaining perfect equipment
to maintain perfect quality of products. The condition are checked and
measure in time series to very that measure values are !ithin standard
values to prevent defects. The transition of measured values is
!atched to predict possibilities of defects occurring and to take
counter measures before hand.
Po$%c' "
1. )efect free conditions and control of equipments.
;. Q activities to support quality assurance.
B. 5ocus of prevention of defects at source
@. 5ocus on poka"yoke. % fool proof system &
6. 0n"line detection and segregation of defects.
I. A9ective implementation of operator quality assurance.
T!r5& "
1. ,chieve and sustain customer complaints at $ero
;. (educe in"process defects by 62 3
B. (educe cost of quality by 62 3.
D!&! r=u%r)*&s "
Quality defects are classifed as customer end defects and in house
defects. 5or customer"end data, !e have to get data on
1. Customer end line re4ection
;. 5ield complaints.
0n"house, data include data related to products and data related to
process
D!&! r$!&, &o -ro,uc& "
1. Product !ise defects
;. Severity of the defect and its contribution " ma4orNminor
B. *ocation of the defect !ith reference to the layout
@. agnitude and frequency of its occurrence at each stage of
measurement
6. Gccurrence trend in beginning and the end of each
productionNprocessNchanges. %*ike pattern change, ladleNfurnace
lining etc.&
I. Gccurrence trend !ith respect to restoration of
breakdo!nNmodifcationsNperiodical replacement of quality
components.
D!&! r$!&, &o -rocsss"
1. The operating condition for individual sub"process related to
men, method, material and machine.
;. The standard settingsNconditions of the sub"process
B. The actual record of the settingsNconditions during the defect
occurrence.
PILLAR 9 ( TRAINING "
0t is aimed to have multi"skilled revitali$ed employees !hose
morale is high and !ho has eager to come to !ork and perform all
required functions e9ectively and independently. Aducation is given to
operators to upgrade their skill. 0t is not suLcient kno! only 8[no!"
Ko!8 by they should also learn 8[no!"!hy8. +y e#perience they gain,
8[no!"Ko!8 to overcome a problem !hat to be done. This they do
!ithout kno!ing the root cause of the problem and !hy they are doing
so. Kence it become necessary to train them on kno!ing 8[no!"!hy8.
The employees should be trained to achieve the four phases of skill.
The goal is to create a factory full of e#perts. The di9erent phase of
skills are
Phase 1 . )o not kno!.
Phase ; . [no! the theory but cannot do.
Phase B . Can do but cannot teach
Phase @ . Can do and also teach.
Po$%c' "
1. 5ocus on improvement of kno!ledge, skills and techniques.
;. Creating a training environment for self learning based on felt
needs.
B. Training curriculum N tools Nassessment etc conductive to
employee revitali$ation
@. Training to remove employee fatigue and make !ork en4oyable.
T!r5& "
1. ,chieve and sustain do!ntime due to !ant men at $ero on
critical machines.
;. ,chieve and sustain $ero losses due to lack of kno!ledge N skills N
techniques
B. ,im for 122 3 participation in suggestion scheme.
S&-s %* E,uc!&%*5 !*, &r!%*%*5 !c&%A%&%s "
1. Setting policies and priorities and checking present status of
education and training.
;. Astablish of training system for operation and maintenance skill
up gradation.
B. Training the employees for upgrading the operation and
maintenance skills.
@. Preparation of training calendar.
6. [ick"o9 of the system for training.
I. Avaluation of activities and study of future approach.
PILLAR : ( OFFICE TPM "
GLce TP should be started after activating four other pillars of
TP %FK, [[, Q, P&. GLce TP must be follo!ed to improve
productivity, eLciency in the administrative functions and identify and
eliminate losses. This includes analy$ing processes and procedures
to!ards increased oLce automation. GLce TP addresses t!elve
ma4or losses. They are
1. Processing loss
;. Cost loss including in areas such as procurement, accounts,
marketing, sales leading to high inventories
B. Communication loss
@. 0dle loss
6. Set"up loss
I. ,ccuracy loss
O. GLce equipment breakdo!n
J. Communication channel breakdo!n, telephone and fa# lines
H. Time spent on retrieval of information
12. Con availability of correct on line stock status
11. Customer complaints due to logistics
12. !penses on emergency dispatches"purchases
2o3 &o s&!r& oFc TPM K
, senior person from one of the support functions e.g. Kead of
5inance, 0S, Purchase etc should be heading the sub"committee.
embers representing all support functions and people from
Production Z Quality should be included in sub committee. TP co"
ordinate plans and guides the sub committee.
1. Providing a!areness about oLce TP to all support departments
;. Kelping them to identify P, Q, C, ), S, in each function in
relation to plant performance
B. 0dentify the scope for improvement in each function
@. Collect relevant data
6. Kelp them to solve problems in their circles
I. ake up an activity board !here progress is monitored on both
sides " results and actions along !ith [ai$ens.
O. 5an out to cover all employees and circles in all functions.
@o4&su @!%;* &o-%cs /or OFc TPM "
0nventory reduction
*ead time reduction of critical processes
otion Z space losses
(etrieval time reduction.
Aquali$ing the !ork load
0mproving the oLce eLciency by eliminating the time loss on
retrieval of information, by achieving $ero breakdo!n of oLce
equipment like telephone and fa# lines.
OFc TPM !*, %&s B*+&s "
1. 0nvolvement of all people in support functions for focusing on
better plant performance
;. +etter utili$ed !ork area
B. (educe repetitive !ork
@. (educed inventory levels in all parts of the supply chain
6. (educed administrative costs
I. (educed inventory carrying cost
O. (eduction in number of fles
J. (eduction of overhead costs %to include cost of non"
productionNnon capital equipment&
H. Productivity of people in support functions
12. (eduction in breakdo!n of oLce equipment
11. (eduction of customer complaints due to logistics
1;. (eduction in e#penses due to emergency
dispatchesNpurchases
1B. (educed manpo!er
1@. Clean and pleasant !ork environment.
P # C D S M %* OFc TPM "
P " Production output lost due to !ant of material, anpo!er
productivity, Production output lost due to !ant of tools.
Q " istakes in preparation of cheques, bills, invoices, payroll,
Customer returnsN!arranty attributable to +GPs, (e4ectionNre!ork in
+GPVsN4ob !ork, GLce area re!ork.
C " +uying costNunit produced, Cost of logistics " inboundNoutbound,
Cost of carrying inventory, Cost of communication, )emurrage costs.
) " *ogistics losses %)elay in loadingNunloading&
)elay in delivery due to any of the support functions
)elay in payments to suppliers
)elay in information
S " Safety in material handlingNstoresNlogistics, Safety of soft and hard
data.
" Cumber of kai$ens in oLce areas.
2o3 oFc TPM su--or&s -$!*& TPM "
GLce TP supports the plant, initially in doing Fishu Ko$en of the
machines %after getting training of Fishu Ko$en&, as in Fishu Ko$en at
the
1. 0nitial stages machines are more and manpo!er is less, so the
help of commercial departments can be taken, for this
;. GLce TP can eliminate the lodes on line for no material and
logistics.
EB&*s%o* o/ oFc TPM &o su--$%rs !*, ,%s&r%4u&ors "
This is essential, but only after !e have done as much as
possible internally. 7ith suppliers it !ill lead to on"time delivery,
improved Vin"comingV quality and cost reduction. 7ith distributors it !ill
lead to accurate demand generation, improved secondary distribution
and reduction in damages during storage and handling. 0n any case !e
!ill have to teach them based on our e#perience and practice and
highlight gaps in the system !hich a9ect both sides. 0n case of some of
the larger companies, they have started to support clusters of
suppliers.
PILLAR < ( SAFETYE 2EALT2 AND ENVIRONMENT "
T!r5& "
1. Sero accident,
;. Sero health damage
B. Sero fres.
0n this area focus is on to create a safe !orkplace and a surrounding
area that is not damaged by our process or procedures. This pillar !ill
play an active role in each of the other pillars on a regular basis.
, committee is constituted for this pillar !hich comprises
representative of oLcers as !ell as !orkers. The committee is headed
by Senior vice President % Technical &. -tmost importance to Safety is
given in the plant. anager %Safety& is looking after functions related to
safety. To create a!areness among employees various competitions
like safety slogans, Qui$, )rama, Posters, etc. related to safety can be
organi$ed at regular intervals.
onclusion:
Today, !ith competition in industry at an all time high, TP may
be the only thing that stands bet!een success and total failure for
some companies. 0t has been proven to be a program that !orks. 0t can
be adapted to !ork not only in industrial plants, but in construction,
building maintenance, transportation, and in a variety of other
situations. Amployees must be educated and convinced that TP is not
4ust another 8program of the month8 and that management is totally
committed to the program and the e#tended time frame necessary for
full implementation. 0f everyone involved in a TP program does his or
her part, an unusually high rate of return compared to resources
invested may be e#pected.
TPM !c0%A)*&s
any TP sites have made e#cellent progress in a number of
areas. These include.
better understanding of the performance of their equipment %!hat
they are achieving in GAA terms and !hat the reasons are for
non"achievement&,
better understanding of equipment criticality and !here it is !orth
deploying improvement e9ort and potential benefts,
improved team!ork and a less adversarial approach bet!een
Production and aintenance,
improved procedures for changeovers and set"ups, carrying out
frequent maintenance tasks, better training of operators and
maintainers, !hich all lead to reduced costs and better service,
general increased enthusiasm from involvement of the !orkforce.
Ko!ever the central parado# of the !hole TP Process is that,
given that TP is supposed to be about doing better maintenance, !hy
do proponents end up !ith %largely& the same discredited schedules
that they had already %albeit no! being done by di9erent people&Y This
is the central parado# " yes, the organisation is more empo!ered, and
re"shaped to allo! us to carry out maintenance in the modern arena,
but !eVre still left !ith the problem of !hat maintenance should be
done.
The (eliability Centered aintenance process !as evolved
!ithin the civil aviation industry to fulfl this precise need. 0n fact, the
defnition of (C is 8a process used to determine the maintenance
requirements of physical assets in their present operating conte#t8. 0n
essence, !e have t!o ob4ectives: determine the maintenance
requirements of the physical assets !ithin their current operating
conte#t, and then ensure that these requirements are met as cheaply
and e9ectively as possible.
(C is better at delivering ob4ective one: TP focuses on ob4ective
t!o.
To&!$ Pro,uc&%A M!%*&*!*c %* I*,%!
The 0ndian 0ndustry is facing a severe global competition and
hence many companies are fnding it very diLcult to meet the bottom
line.
The past decade has transformed the defnition of arket Price,
!hich !as based on simple assumption under the monopolistic
condition as given belo!.
+roduction cost 5 +roft 6 Mar!et price
Ko!ever, under the present scenario !here all are facing the
domesticNglobal competition, the above defnition does not hold good Z
simply got transformed into.
Mar!et prices 1 +rod& Cost 6 +roft
,lthough the above t!o equations mathematically look to be the
same, the di9erence is obvious as in the present scenario. The
customer !ho has become quite demanding !ith respect to cost,
quality Z variety determines the market price. The current economic
environment automatically brings tremendous pressure on optimi$ing
the Production cost Z for survival of the unit also.
TP meets the challenge Z provides an e9ective program in
terms of increased plant eLciency Z productivity.
TP is a means of creating a safe Z participative !ork
environment, in !hich all employees target the elimination of all kinds
of !aste generated due to equipment failure, frequent breakdo!ns,
defective products including re4ections Z re!ork. This leads to higher
employee morale and greater organi$ational proftability.
TP implementation is not a diLcult task. Ko!ever, it requires.
1. Total commitment to the program by Top anagement as it has
to be TGP
)(0PAC to succeed.
;. Total involvement Z participation of all the employees.
B. ,ttitudinal changes Z paradigm shift to!ards 4ob responsibilities.
Steps involved in e9ective implementation of TP are given brieMy as
follo!s.
1. ,ppoint a committed Z responsible coordinator !ho is !ell"versed
in TP concept Z able to convince the entire !ork force through an
educational program.
;. Select a odel Cell or a achine, !hich has the ma#imum potential
for improvement in respect of optimi$ing the profts. Such a model
cell or machine !ill have the ma#imum problems in respect of
b Product quality
b Aquipment failure Z frequent breakdo!ns
b -nsafe conditions causing safety ha$ards
B. The TP coordinator !ill head a small team comprising of the
concerned persons of selected model cell or machine Z !ould
initiate the TP program by frst recording meticulously Z
observing fullest transparency of the problematic areas in respect
of product defects, equipment breakdo!n data Z number of
accidents from the past data, if available. Ko!ever, if the reliable
data is not available, the same !ill have to be built up for the
purpose of cbenchmarkingD Z keeping the records of progress Z
scheduling the improvements %target& !ithin the time period.
@. The TP coordinator !ould encourage the Team member to initiate
the TP through 0nitial Cleaning of the machines taken as a odel
for improvement. 0nitial Cleaning is done to remove cshortcomingsD
or defects developed over the years, !hich have remained
unnoticed.
6. 0nitial Cleaning activities include removing dust, dirt, Mu9 etc.
Through this process, improper conditions of the machine get
detected in the form of.
0naccuracies leading to defects in regard to quality
)efective partsNcomponents leading to the development of
defects in
the machine
)etection of e#cessive !ear Z tear in the moving parts of the
machine
leading to production of defective parts.
otion resistance observed due to foreign matters found in
moving
parts of the machine.
)etection of defects like loose fasteners, scratches,
deformation Z
leakage etc., remaining invisible in dirty equipment.
The initial cleaning leads to 0nspection !hich in turn helps in
detecting the ,+CG(,*0T0AS in the equipment gathered over the
years causing quality defects, equipment failures, Z safety ha$ards.
The ,ction Teams !ould be responsible to ascertain the problem areas,
determining the sources of generation of abnormalitiesZ those causing
forced deterioration. Through deliberation of various techniques the
team !ould detail out a course of corrective action and implementing
the corrective process. 0t is quite possible that in the beginning
recogni$ing problem areas Z determining the counter measures
eliminating the sources of error, the team members may not fnd easy.
They have to continue their thinking creatively that things could be
done better.
Prssur ,% c!s&%*5 Co)-!*'"
5or this company one II2 T KT mNc !as selected for
developing it as a odel Cell. The mNc !as studied Z evaluated
critically in depth by the team. The team decided to set frst ob4ective
as to achieve c )elightful 7orking Anvironment D!hich is a pre"requisite
to the introduction of practices of TP.
The team identifed 1@ cause factors responsible for the present
condition of the mNc Z coming in the !ay of achieving the c)7AD, the
frst ob4ective.
These cause factors !ere analy$ed Z improvement themes !ere
developed such as counter measures to dust Z dirt, diLcult to clean Z
non accessible areas, counter measures to leakages, Mash Z !ater
spray, die coat spray etc. 0mplementation of solutions resulted into the
follo!ing ma4or achievements.
)elightful !orking environment
Productivity improvement by ;23
etal saving through elimination of Mash Z coil formation
during each
stroke.
Similar achievements resulted in the ,utomobile Company also in
the form of +reakdo!n reduction
)efects reduction
Space saving
Productivity improvement
To make these achievements sustainable a very important aspect of
TP is the establishment of ,utonomous aintenance. The purpose of
autonomous inspection is to teach operators ho! to maintain their
equipment by performing daily the follo!ing in not more than 16
minutes Z thus developing an co!nership of machineD.

d )aily checks
d *ubrication management
d Tightening Z checking schedule of fasteners
d Cleaning schedule
d Aarly detection of abnormal condition of the machine through
sound, temperature Z vibration.
0n the current 0ndustrial scenario, TP may be one of the only
concepts that stand bet!een success and total failure for some
organi$ations. 0t is a program that !orks if it is implemented e9ectively
!ith all sincerity Z dedicated e9orts of participative team.
Tro&c0*o$o5'
, /reek !ord referring to the study of the costs associated !ith
an asset throughout its life cycle, from acquisition to disposal. The
goals of this approach are to try to reduce the di9erent costs incurred
at the various stages of the assetVs life and to derive methods that !ill
help e#tend the assetVs life span. ,lso kno!n as 8life"cycle costing8.
Terotechnology uses tools such as net present value, internal
rate of return and discounted cash Mo! in an attempt to minimi$e the
costs associated !ith the asset in the future. These costs can include
engineering, maintenance, !ages payable to operate the equipment,
operating costs and even disposal costs.
5or e#ample, letVs say an oil company is attempting to map out
the costs of an o9shore oil platform. They !ould use terotechnology to
map out the e#act costs associated !ith assembly, transportation,
maintenance and dismantling of the platform and fnally a calculation
of salvage value.
This study is not an e#act science as you can imagine. There are
many di9erent variables that need to be estimated and appro#imated.
Ko!ever, a company !ho does not use this kind of study may be
!orse o9 than one that approaches an assetVs life cycle in a more ad
hoc manner.
3.M TEROTEC2NOLOGY
Tro&c0*o$o5'" , !ord derived from the /reek and meaning the
study and management of an assetVs life from its very start
%acquisition& to its very end %fnal disposal, perhaps involving
dismantling and specialised treatment prior to scrap&. Gne of the most
dramatic e#amples of the full consideration of terotechnology is the
construction, use and fnal decommissioning of an oil platform at sea.
, !ord derived from the /reek root !ord 8tero8 or 80 care8, that is
no! used !ith the term 8technology8 to refer to the study of the costs
associated !ith an asset throughout its life cycle " from acquisition to
disposal. The goals of this approach are to reduce the di9erent
costs incurred at the various stages of the assetVs life and to derive
methods that !ill help e#tend the assetVs life span.
Terotechnology uses tools such as net present value, internal
rate of return and discounted cash Mo! in an attempt to minimi$e the
costs associated !ith the asset in the future. These costs can include
engineering, maintenance, !ages payable to operate the equipment,
operating costs and even disposal costs.
,lso kno!n as 8life"cycle costing8.
For B!)-$, letVs say an oil company is attempting to map out the
costs of an o9shore oil platform. They !ould use terotechnology to
map out the e#act costs associated !ith assembly, transportation,
maintenance and dismantling of the platform, and fnally a calculation
of salvage value.
This study is not an e#act science as you can imagine. There are
many di9erent variables that need to be estimated and appro#imated.
Ko!ever, a company !ho does not use this kind of study may be
!orse o9 than one that approaches an assetVs life cycle in a more ad
hoc manner.
L%/(C'c$ Cos&%*5
Astimates of a productVs revenues and e#penses over its
e#pected life cycle. The result is to highlight upstream and do!nstream
costs in the cost planning process that often receive insuLcient
attention. Amphasis is on the need to price products to cover all costs,
not 4ust production costs.
2%s&or' o/ $%/ c'c$ cos& !*!$'s%s
*ife cycle cost analysis became popular in the 1HI2s !hen the
concept !as taken up by -.S. government agencies as an instrument
to improve the cost e9ectiveness of equipment procurement. 5rom that
point, the concept has spread to the business sector, and is used there
in ne! product development studies, pro4ect evaluations and
management accounting. ,s there is high interest in life cycle cost
analysis in maintenance, the 0nternational Alectro technical
Commission published a standard %0AC I2B22& in 1HHI, !hich lies in
the feld of dependability management and gives recommendations
ho! to carry out life cycle costing. This standard !as rene!ed in Fuly
;22@.
R!$%;!&%o* o/ ! $%/ c'c$ cos& !*!$'s%s
, $%/ c'c$ cos& !*!$'s%s calculates the cost of a system or
product over its entire life span. This also involves the process of
Product *ife Cycle anagement so that the life cycle profts are
ma#imi$ed.
The analysis of a typical system could include costs for.
planning,
research and development,
production,
operation,
maintenance,
Cost of replacement,
)isposal or salvage.
This cost analysis depends on values calculated from other
reliability analyses like failure rate, cost of spares, repair times, and
component costs.
Sometimes called a 8cradle"to"grave analysis8, or 87omb"to"Tomb8
, life cycle cost analysis is important for cost accounting
purposes. 0n deciding to produce or purchase a product or service, a
timetable of life cycle costs helps sho! !hat costs need to be allocated
to a product so that an organi$ation can recover its costs. 0f all costs
can not be recovered, it !ould not be !ise to produce the product or
service.
0t reinforces the importance of locked"in costs, such as (Z).
0t o9ers three important benefts.
" ,ll costs associated !ith a pro4ectNproduct become visible, especially.
upstream, (Z): do!nstream, customer service.
" 0t allo!s an analysis of business function interrelationships. *o! (Z)
costs
may lead to high customer service costs in the future.
" )i9erences in early stage e#penditure are highlighted, enabling
managers to
develop accurate revenue predictions.
, typical quantitative analysis !ould involve the use of a
statement !here an easy comparison of costs can be seen by having
the di9erent products a company produces ne#t to each other.
D%s!)4%5u!&%o*"
*ife cycle cost analysis or life cycle costing should not be confused !ith
life cycle analysis !hich is a part of the 0SG 1@222 series
concerned !ith environmental issues
product life cycle analysis !hich is a time dependent marketing
construct
3.1> BUSINESS PROCESS RE(ENGINEERING (BPR)E PRINCIPLESE
APPLICATIONS
+usiness Process (eengineering is a management approach aiming
at improvements by means of elevating eLciency and e9ectiveness of
the processes that e#ist !ithin and across organi$ations.
+usiness process reengineering is also kno!n as +P(, +usiness
Process (edesign, +usiness Transformation, or +usiness Process
Change anagement.
0n 1HH2, ichael Kammer, a former professor of computer science
at the assachusetts 0nstitute of Technology %0T&, published an article
in the Karvard +usiness (evie!, in !hich he claimed that the ma4or
challenge for managers is to obliterate non"value adding !ork, rather
than using technology for automating it. This statement implicitly
accused managers of having focused the !rong issues, namely that
technology in general, and more specifcally information technology,
has been used primarily for automating e#isting !ork rather than using
it as an enabler for making non"value adding !ork obsolete.
KammerVs claim !as simple. ost of the !ork being done does not
add any value for customers, and this !ork should be removed, not
accelerated through automation. 0nstead, companies should reconsider
their processes in order to ma#imi$e customer value, !hile minimi$ing
the consumption of resources required for delivering their product or
service. , similar idea !as advocated by Thomas K. )avenport and F.
Short %1HH2&, at that time a member of the Arnst Z Toung research
center, in a paper published in the Sloan anagement (evie! the
same year as Kammer published his paper.
This idea, to unbiasedly revie! a companyDs business processes,
!as rapidly adopted by a huge number of frms, !hich !ere striving for
rene!ed competitiveness, !hich they had lost due to the market
entrance of foreign competitors, their inability to satisfy customer
needs, and their insuLcient cost structure. Aven !ell established
management thinkers, such as Peter )rucker and Tom Peters, !ere
accepting and advocating +P( as a ne! tool for %re"&achieving success
in a dynamic !orld. )uring the follo!ing years, a fast gro!ing number
of publications, books as !ell as 4ournal articles, !as dedicated to +P(,
and many consulting frms embarked on this trend and developed +P(
methods. Ko!ever, the critics !ere fast to claim that +P( !as a !ay to
dehumani$e the !ork place, increase managerial control, and to 4ustify
do!nsi$ing, i.e. ma4or reductions of the !ork force %/reenbaum 1HH6,
0ndustry 7eek 1HH@&, and a rebirth of Taylorism under a di9erent label.
)espite this critique, reengineering !as adopted at an accelerating
pace and by 1HHB, as many as I63 of the 5ortune 622 companies
claimed to either have initiated reengineering e9orts, or to have plans
to do so.
3e4nition of &")
)i9erent defnitions can be found. This section contains the
defnition provided in notable publications in the feld.
Kammer and Champy %1HHB& defne +P( as 8... the fundamental
rethinking and radical redesign of business processes to achieve
dramatic improvements in critical contemporary measures of
performance, such as cost, quality, service, and speed.8
Thomas K. )avenport %1HHB&, another !ell"kno!n +P( theorist,
uses the term process innovation, !hich he says =encompasses the
envisioning of ne! !ork strategies, the actual process design activity,
and the implementation of the change in all its comple# technological,
human, and organi$ational dimensions=.
,dditionally, )avenport points out the ma4or di9erence bet!een +P(
and other approaches to organi$ation development %G)&, especially the
continuous improvement or TQ movement, !hen he states.
8Today frms must seek not fractional, but multiplicative levels of
improvement ' 12# rather than 123.8
5inally, Fohansson et al& %1HHB& provide a description of +P(
relative to other process"oriented vie!s, such as Total Quality
anagement %TQ& and Fust"in"time %F0T&, and state.
8+usiness Process (eengineering, although a close relative,
seeks radical rather than merely continuous improvement. 0t escalates
the e9orts of F0T and TQ to make process orientation a strategic tool
and a core competence of the organi$ation. +P( concentrates on core
business processes, and uses the specifc techniques !ithin the F0T and
TQ =toolbo#es= as enablers, !hile broadening the process vision.8
0n order to achieve the ma4or improvements +P( is seeking for,
the change of structural organi$ational variables, and other !ays of
managing and performing !ork is often considered as being
insuLcient. 5or being able to reap the achievable benefts fully, the
use of information technology %0T& is conceived as a ma4or contributing
factor. 7hile 0T traditionally has been used for supporting the e#isting
business functions, i.e. it !as used for increasing organi$ational
eLciency, it no! plays a role as enabler of ne! organi$ational forms,
and patterns of collaboration !ithin and bet!een organi$ations.
+P( derives its e#istence from di9erent disciplines, and four
ma4or areas can be identifed as being sub4ected to change in +P( "
organi$ation, technology, strategy, and people " !here a process vie!
is used as common frame!ork for considering these dimensions.
+usiness strategy is the primary driver of +P( initiatives and the
other dimensions are governed by strategyVs encompassing role. The
organi$ation dimension reMects the structural elements of the
company, such as hierarchical levels, the composition of organi$ational
units, and the distribution of !ork bet!een them. Technology is
concerned !ith the use of computer systems and other forms of
communication technology in the business. 0n +P(, information
technology is generally considered as playing a role as enabler of ne!
forms of organi$ing and collaborating, rather than supporting e#isting
business functions. The people N human resources dimension deals
!ith aspects such as education, training, motivation and re!ard
systems. The concept of business processes " interrelated activities
aiming at creating a value added output to a customer " is the basic
underlying idea of +P(. These processes are characteri$ed by a
number of attributes. Process o!nership, customer focus, value"
adding, and cross"functionality.
The role of information technology
0nformation technology %0T& plays an important role in the
reengineering concept. 0t is considered as a ma4or enabler for ne!
forms of !orking and collaborating !ithin an organi$ation and across
organi$ational borders.
The early +P( literature, e.g. Kammer Z Champy %1HHB&, identifed
several so called disruptive technologies that !ere supposed to
challenge traditional !isdom about ho! !ork should be performed.
1. Shared databases, making information available at many places
;. A#pert systems, allo!ing generalists to perform specialist tasks
B. Telecommunication net!orks, allo!ing organi$ations to be
centrali$ed and decentrali$ed at the same time
@. )ecision"support tools, allo!ing decision"making to be a part of
everybodyVs 4ob
6. 7ireless data communication and portable computers, allo!ing
feld personnel to !ork oLce independent
I. 0nteractive videodisk, to get in immediate contact !ith potential
buyers
O. ,utomatic identifcation and tracking, allo!ing things to tell
!here they are, instead of requiring to be found
J. Kigh performance computing, allo!ing on"the"My planning and
revisioning
0n the mid 1HH2s, especially !orkMo! management systems !ere
considered as a signifcant contributor to improved process eLciency.
,lso A(P %Anterprise (esource Planning& vendors, such as S,P,
positioned their solutions as vehicles for business process redesign and
improvement.
-etho%ology
,lthough the names and steps being used di9er slightly bet!een
the di9erent methodologies, they share the same basic principles and
elements. The follo!ing description is based on the P(*C %Process
(eengineering *ife Cycle& approach developed by /uha et.al. %1HHB&. ,
more detailed description can be found here.
FIGURE 3.11
Simplifed schematic outline of using a business process
approach, e#amplifed for pharmceutical (Z).
1. Structural organi$ation !ith functional units
;. 0ntroduction of Ce! Product )evelopment as cross"functional
process
B. (e"structuring and streamlining activities, removal of non"value
adding tasks
1. Anvision ne! processes
1. Secure management support
;. 0dentify reengineering opportunities
B. 0dentify enabling technologies
@. ,lign !ith corporate strategy
;. 0nitiating change
1. Set up reengineering team
;. Gutline performance goals
B. Process diagnosis
1. )escribe e#isting processes
;. -ncover pathologies in e#isting processes
@. Process redesign
1. )evelop alternative process scenarios
;. )evelop ne! process design
B. )esign K( architecture
@. Select 0T platform
6. )evelop overall blueprint and gather feedback
6. (econstruction
1. )evelopNinstall 0T solution
;. Astablish process changes
I. Process monitoring
1. Performance measurement, including time, quality, cost, 0T
performance
;. *ink to continuous improvement
&") 9 a rebirth of scienti4c management:
+y its critics, +P( is often accused to be a re"animation of
TaylorVs principles of scientifc management, aiming at increasing
productivity to a ma#imum, but disregarding aspects such as !ork
environment and employee satisfaction. 0t can be agreed that TaylorVs
theories, in con4unction !ith the !ork of the early administrative
scientists have had a considerable impact on the management
discipline for more than 62 years. Ko!ever, it is not self"evident that
+P( is a close relative to Taylorism and this proposed relation deserves
a closer investigation.
0n the late 1Hth century 5rederick 7inslo! Taylor, a mechanical
engineer, started to develop the idea of management as a scientifc
discipline. Ke applied the premise that !ork and its organi$ational
environment could be considered and designed upon scientifc
principles, i.e. that !ork processes could be studied in detail using a
positivist analytic approach. -pon the basis of this analysis, an optimal
organi$ational structure and !ay of performing all !ork tasks could be
identifed and implemented. Ko!ever, he !as not the one to originally
invent the concept. 0n 1JJI, a paper entitled ,'he Engineer as
Economist,, !ritten by Kenry (. To!ne for the ,merican Society of
echanical Angineers, had laid the bedrock for the development of
scientifc management.
The basic idea of scientifc management !as that !ork could be
studied from an ob4ective scientifc perspective and that the analysis of
the gathered information could be used for increasing productivity,
especially of blue"collar !ork, signifcantly. Taylor %1H11& summari$ed
his observations in the follo!ing four principles.
Gbservation and analysis through time study to set the optimal
production rate. 0n other !ords, develop a science for each manDs
task'a Gne +est 7ay.
Scientifcally select the best man for the 4ob and train him in the
procedures he is e#pected to follo!.
Cooperate !ith the man to ensure that the !ork is done as
described. This means establishing a di9erential rate system of
piece !ork and paying the man on an incentive basis, not
according to the position.
)ivide the !ork bet!een managers and !orkers so that
managers are given the responsibility for planning and
preparation of !ork, rather than the individual !orker.
Scientifc managementDs main characteristic is the strict separation
of planning and doing, !hich !as implemented by the use of a
functional foremanship system. This means, that a !orker, depending
on the task his is performing, can report to di9erent foreman, each of
them being responsible for a small, speciali$ed area.
TaylorDs ideas had a ma4or impact on manufacturing, but also
administration. Gne of the most !ell"kno!n e#amples is 5ord otor
Co., !hich adopted the principles of scientifc management at an early
stage, and built its assembly line for the T"model based on TaylorDs
model of !ork and authority distribution, thereby giving name to
5ordism.
Successes
+P(, if implemented properly, can give huge returns. +P( has
helped giants like Procter and /amble Corporation and /eneral otors
Corporation succeed after fnancial dra!backs due to competition. 0t
helped ,merican ,irlines some!hat get back on track from the bad
debt that is currently haunting their business practice. +P( is about the
proper method of implementation.
/eneral otors Corporation implemented a B"year plan to
consolidate their multiple desktop systems into one. 0t is kno!n
internally as 8Consistent GLce Anvironment8. This reengineering
process involved replacing the numerous brands of desktop systems,
net!ork operating systems and application development tools into a
more manageable number of vendors and technology platforms.
,ccording to )onald /. Kedeen, director of desktops and deployment
at / and manager of the upgrade program, he says that the process
8lays the foundation for the implementation of a common business
communication strategy across /eneral otors.8 %+ooker, 1HH@&. *otus
)evelopment Corporation and Ke!lett"Packard )evelopment
Company, formerly Compaq Computer Corporation, received the single
largest non"government sales ever from /eneral otors Corporation.
/ also planned to use Covell Cet7are as a security client, icrosoft
GLce and Ke!lett"Packard printers. ,ccording to )onald /. Kedeen,
this saved / 123 to ;63 on support costs, B3 to 63 on hard!are,
@23 to I23 on soft!are licensing fees, and increased eLciency by
overcoming incompatibility issues by using 4ust one platform across the
entire company.
South!est ,irlines o9ers another successful e#ample of
reengineering their company and using 0nformation Technology the
!ay it !as meant to be implemented. 0n 1HH;, South!est ,irlines had
a revenue of R1.O billion and an after"ta# proft of RH1 million.
,merican ,irlines, the largest -.S. carrier, on the other hand had a
revenue of R1@.@ billion dollars but lost R@O6 million and has not made
a proft since 1HJH %5urey and )iorio, 1HH@&. Companies like South!est
,irlines kno! that their formula for success is easy to copy by ne!
start"ups like orris, (eno, and [i!i ,irlines. 0n order to stay in the
game of competitive advantage, they have to continuously reengineer
their strategy. +P( helps them be original.
riti.ue
The most frequent and harsh cirtique against +P( concerns the
strict focus on eLciency and technology and the disregard of people in
the organi$ation that is sub4ected to a reengineering initiative. Pery
often, the label +P( !as used for ma4or !orkforce reductions. Thomas
)avenport, an early +P( proponent, stated that
87hen 0 !rote about 8business process redesign8 in 1HH2, 0
e#plicitly said that using it for cost reduction alone !as not a sensible
goal. ,nd consultants ichael Kammer and Fames Champy, the t!o
names most closely associated !ith reengineering, have insisted all
along that layo9s shouldnVt be the point. +ut the fact is, once out of the
bottle, the reengineering genie quickly turned ugly.8 %)avenport, 1HH6&
ichael Kammer similarly admitted that
80 !asnVt smart enough about that. 0 !as reMecting my
engineering background and !as insuLcient appreciative of the
human dimension. 0Vve learned thatVs critical.8 %7hite, 1HHI&
Gther criticism brought for!ard against the +P( concept include
lack of management support for the initiative and thus poor
acceptance in the organi$ation.
e#aggerated e#pectations regarding the potential benefts from a
+P( initiative and consequently failure to achieve the e#pected
results.
underestimation of the resistance to change !ithin the
organi$ation.
implementation of generic so"called best"practice processes that
do not ft specifc company needs.
overtrust in technology solutions.
performing +P( as a one"o9 pro4ect !ith limited strategy
alignment and long"term perspective.
poor pro4ect management.
3evelopment after ;<<5
7ith the publication of critical articles by some of the founding
fathers of the +P( concept in 1HH6 and 1HHI the reengineering hype
!as e9ectively over. Since then, considering business processes as a
starting point for business analysis and redesign has become a !idely
accepted approach and is a standard part of the change methodology
portfolio, but is typically performed in a less radical !ay as originally
proposed.
ore recently, the concept of +usiness Process anagement
%+P& has gained ma4or attention in the corporate !orld and can be
considered as a successor to the +P( !ave of the 1HH2s, as it is evenly
driven by a striving for process eLciency supported by information
technology. Aquivalently to the critique brought for!ard against +P(,
+P is no! accused of focusing on technology and disregarding the
people aspects of change.
A--$%c!&%o* R(E*5%*r%*5
+usiness Process (e"engineering %+P(& combines aspects of re"
engineering and business process outsourcing, and rationali$es them
to return value in a short span of time. This, of course, ma#imi$es long"
term prospects for your business.
0nfosys provides +usiness Process (e"engineering %+P(& solutions
that assist you to fundamentally rethink and redesign ho! your
organi$ation !ill meet its strategic ob4ectives. Amphasis is on
innovation, Me#ibility, quality service delivery, and cost control by re"
engineering business methods and supporting processes using state"
of"the"art +P( tools and methodologies.
+usiness Process re"engineering services address the need to
leverage ne!er technology platforms, frame!orks, and soft!are
products to transform 0T systems and applications. +usiness Process
(e"engineering applications help you.
Scale up to handle a larger user base
A9ectively address operational or performance issues !ith
current application portfolio
,chieve a higher degree of maintainability
,lleviate licensing and support issues !ith the older technologies
0mprove user friendliness and portability of applications
(educe costs associated !ith maintaining old and poorly
documented legacy system

0nfosysV +usiness Process (e"engineering services are backed by
delivery e#cellence, robust consulting capabilities and proprietary tools
and frame!orks.
Ko! can be dramatically improvedY
Bus%*ss !*, &c0*o$o5' c!-!4%$%&%s" Teams of dedicated
business and technology specialists !ork !ith pro4ect teams to
understand systems and architect robust technology solutions
for re"engineering or migration.
R(*5%*r%*5 -rocss" Coupled !ith C *evel 6 re"
engineering process, 0nfosys achieves one of the best metrics in
the industry.
Pro-r%&!r' I*F$uB )&0o,o$o5'" 0n5lu# methodology aligns
0T solutions to business requirements. 0t prescribes a methodical,
process"centric approach to translate business requirements into
clear 0T solutions. 0t is a systematic and repeatable process that
derives every part of the solution from the business process that
!ill ultimately use it. 0n5lu# uses models, methods, techniques,
tools, patterns and frame!orks to achieve a smooth translation
of enterprise business ob4ectives into an e9ective 0T solution.
ProQc& )!*!5)*& c!-!4%$%&'" Gur proprietary pro4ect
management processes, !ell integrated pro4ect management
tools, and senior management involvement at every stage of the
pro4ect ensure that you !ill beneft from de"risked pro4ect
management.
Bus%*ss Procss R(*5%*r%*5" (e"engineer your business
processes to help to achieve performance improvements.
F$B%4$ Arc0%&c&ur D+*%&%o*" )efne the ne! solution
architecture to make any enhancement easy to implement.
S&ro*5 C*o3$,5 )!*!5)*& ,%sc%-$%*s" 0nfosys has
clearly"defned kno!ledge management process and support
infrastructure, and has a number of kno!ledge assets on re"
engineering in di9erent technology platforms.
R%sC M!*!5)*&" Strong pro4ect planning and management
processes reduce operational and other business risks.
S)oo&0 ro$$ou&" Strong pro4ect management and re"
engineering processes ensure a smooth rollout of ne!
technology platforms, organi$ation"!ide.
3.11 REENGINEERING PROCESSE BENEFITS AND LIMITATIONS
R*5%*r%*5
R*5%*r%*5 %or r(*5%*r%*5& is the radical redesign of
an organi$ationVs processes, especially its business processes. (ather
than organi$ing a frm into functional specialties %like production,
accounting, marketing, etc.& and looking at the tasks that each
function performs, !e should, according to the reengineering theory,
be looking at complete processes from materials acquisition, to
production, to marketing and distribution. The frm should be re"
engineered into a series of processes.
The main proponents of re"engineering !ere ichael Kammer
and Fames ,. Champy. 0n a series of books including 7eengineering the
Corporation, 7eengineering Management, and 'he Agenda, they argue
that far too much time is !asted passing"on tasks from one
department to another. They claim that it is far more eLcient to
appoint a team !ho are responsible for all the tasks in the process. 0n
'he Agenda they e#tend the argument to include suppliers,
distributors, and other business partners.
(e"engineering is the basis for many recent developments in
management. The cross"functional team, for e#ample, has become
popular because of the desire to re"engineer separate functional tasks
into complete cross"functional processes. ,lso, many recent
management information systems developments aim to integrate a
!ide number of business functions. Anterprise resource planning,
supply chain management, kno!ledge management systems,
group!are and collaborative systems, Kuman (esource anagement
Systems and customer relationship management systems all o!e a
debt to re"engineering theory.
riticisms of re9engineering
0t has earned a bad reputation because such pro4ects have often
resulted in massive layo9s. This reputation is not altogether
un!arranted, since companies have often do!nsi$ed under the banner
of reengineering.
5urther, reengineering has not al!ays lived up to its
e#pectations. The main reasons seem to be that.
reengineering assumes that the factor that limits
organi$ationVs performance is the ine9ectiveness of its processes
%!hich may or may not be true& and o9ers no means of
validating that assumption
reengineering assumes the need to start the process of
performance improvement !ith a 8clean slate8, i.e. totally
disregard the status 8uo
according to Aliyahu . /oldratt %and his theory of
constraints& reengineering does not provide an e9ective !ay to
focus improvement e9orts on the organi$ationVs constraint.
There !as considerable hype surrounding the bookVs introduction
%partially due to the fact that the authors of 7eengineering the
Corporation reportedly bought numbers of copies to promote it to the
top of bestseller lists&.
,brahamson %1HHI& sho!ed that fashionable management terms
tend to follo! a lifecycle, !hich for (eengineering peaked bet!een
1HHB and 1HHI %Pon$i and [oenig ;22;&. 7hile arguing that
(eengineering !as in fact nothing ne! %as e.g. !hen Kenry 5ord
implemented the assembly line in 1H2J, he !as in fact reengineering,
radically changing the !ay of thinking in an organi$ation&, )ubois
%;22;& highlights the value of signaling terms as (eengineering, giving
it a name, and stimulating it. ,t the same there can be a danger in
usage of such fashionable concepts as mere ammunition to implement
particular reforms.
R*5%*r%*5 4' P!u$ A. S&r!ss)!**
e,cerpte% from The "olitics of 0nformation -anagement
The 0nformation Economics "ress= ;<<5
Aarly in 1HHB, an epochal event took place in the -S. 5or the frst
time in history, 8!hite"collar8 unemployment e#ceeded 8blue"collar8
unemployment. 0n the e#perience of older generations, a college
education entitles one to a 4ob !ith an e#cellent earning potential,
long"term 4ob security and opportunity to climb a career ladder. 0f there
!as an economic do!nturn, unemployment !as something that
happened to others.
*arge"scale !hite collar unemployment should not have come as a
surprise. Since 1HOH, the -S. information !orkforce has kept climbing
and in 1HHB stood at 6@3 of total employment. 5orty million ne!
information !orkers had appeared since 1HI2.
7hat do these people doY They are very busy and end up as
either as corporate or social overhead if they !ork in the public sector.
They are la!yers, consultants, coordinators, clerks, administrators,
managers, e#ecutives and e#perts of all sorts. The e#pansion in
computer"related occupations greatly increased the amount of
information that these people could process and therefore demand
from others. 0t is the characteristics of information !ork that it breeds
additional information !ork at a faster rate than number of people
added to the information payroll. Computers turned out to be greater
multipliers of !ork than any other machine ever invented.
Ko!ever, the greatest gro!th has been in government !hich
no! employs more people than the manufacturing sector. /overnment
!orkers predominantly are engaged in passing information and
redistributing money !hich requires compliance !ith comple#
regulations.
7ho pays for this gro!th in overheadY Averybody does either in
higher prices or as increased ta#es. ,s long as -S. frms could raise
prices, there !as al!ays room for more overhead. 7hen international
economic competition started cutting into market share starting in the
1HJ2s corporations had to reduce sta9 costs.
+lue collar labor essential to manufacture goods !as either
outsourced to foreign lands, or automated, using proven industrial
engineering methods to substitute capital for labor. +y the mid 1HJ2s
ma4or cost cuts could come only from reductions in overhead.
OAr0!, Cos& R,uc&%o*
Aarly attempts announcing ;23 or more across"the board layo9s
in ma4or corporations misfred. The most valuable e#perts left frst to
start up business ventures, most often !ith the kno!ledge they gained
!hile the large frms lingered in bringing innovations into the
marketplace. uch of the dynamic gro!th of the Silicon Palley and of
the comple#es surrounding +oston have their origins in the
entrepreneurial e#ploitation of huge research and development
investments of large corporations.
The ne#t !ave !as even more !asteful, because overhead !as
reduced by imposing cost cutting targets !ithout the beneft of
redesigning any of the business processes. Companies that resorted to
these crude methods did not have the e#perience ho! to measure the
value"added of information !orkers. Therefore, they resorted to
methods that may have been some!hat e9ective for controlling 8blue
collar8 employees. That !as not successful because the same
treatment that !as acceptable for factory !orkers made the remaining
management sta9 act in defensive and counterproductive !ays to
protect their positions. Such methods disoriented and demorali$ed
many !ho !ere responsible for managing customer service.
This is !here reengineering came in. 0t applies !ell kno!n
industrial engineering methods of process analysis, activity costing and
value"added measurement !hich have been around for at least 62
years.
A--!r!*c o/ R*5%*r%*5
The essence of reengineering is to make the purge of recent
e#cess staLng binges more palatable to managers. These e#ecutives
became accustomed to increasing their o!n sta9 support as a means
for to!ards gaining greater organi$ational clout. ,n unspoken
convention used by of oLcials at high government and corporate
levels, is that a 8position8 in a hierarchy e#ists independently of
!hether something useful is delivered to customers. The primary
purpose of high level sta9s is to act as guardians of the bureaucracyVs
budget, privileges and inMuence.
0f you !ant to perform surgery on management overhead, do not
do it in a dark room !ith a machete. 5irst, you must gain acceptance
from those !ho kno! ho! to make the organi$ation !ork !ell. Second,
you must elicit their cooperation in telling you !here the cutting !ill do
the least damage. Third, and most importantly, they must be !illing to
share !ith you insights !here removal of an e#isting business process
!ill actually improve customer services.
+udget cutters !ho do little else than seek out politically unprotected
components, cannot possibly kno! !hat are the full consequences of
their actions.
(eengineering o9ers to them an easy !ay out. (eengineering
calls for thro!ing out everything that e#ists and recommends
reconstituting a !orkable organi$ation on the basis of completely fresh
ideas. The ne! business model is e#pected to spring forth from the
inspired insights of a ne! leadership team.
(eengineering is a contemporary repackaging industrial
engineering methods from the past, rather something that is totally
original. This cure is no! administered in large doses to business
enterprises that must instantly sho! improved profts to survive.
Ko!ever, reengineering di9ers from the incremental and carefully
analytic methods of the past. 0n political form it is much closer to a
coup dVetat than to the methods of a parliamentary democracy.
R*5%*r%*5 %* &0 Pu4$%c Sc&or
)espite admirable pronouncements about reengineering the -S.
government, it remains to be seen if that may be a smoke screen to
4ustify more spending. ,s long as the federal government continues to
increasing ta#es " an easy !ay out of any cost pressures " the
prospects of reinventing the government !ill remain dim.
(einventing government does not deliver savings if mean!hile
you keep e#panding its scope. Tou can have less bureaucracy only of
you eliminate functions that have demonstrably failed, such as loan
guarantees, public housing, diverting schools from education to social
e#perimentation, managing telecommunications and prescribing health
care. A#cept for defense, 4ustice, foreign relations and similar tasks
!hich are essential instruments of governance, public sector attempts
at economic engineering have al!ays failed.
The latest 7ashington reengineering campaign may turn out to
be a retrogression instead of an improvement. Tou do not enhance a
stagnating economy by claiming to save a probable R12J billions so
that you can add over a trillion dollars of economic control to the public
sector.
,n emetic !ill be al!ays an emetic, regardless of the color and
shape of the bottle it comes from. 0t does not do much for those !ho
keep up a healthy diet by eating only !hat their body can use. , cure
claiming to be an emetic but !hich nevertheless fattens !ill increase
obesity.
EB&r)%s&s
(eengineering is a great idea and a clever ne! bu$$!ord. There
is not a manager !ho !ould not support to the idea of taking
something that is defective and then f#ing it. 0ndustrial engineers,
methods analysts and eLciency e#perts have been doing that for a
long time.
The recently introduced label of eLciency through reengineering
covers the adoption of radical means to achieve corrective actions.
This e#tremism o9ers !hat appears to be instant relief from the
pressures on corporate e#ecutives to sho! immediate improvements.
reengineering, as recently promoted, is a ne! label that covers some
consultantsV e#traordinary claims.
To fully understand the intellectual roots of reengineering, let the
most vocal and generally ackno!ledged 8guru8 of reengineering speak
for himself.
8,merican managers ...must abandon the organi$ational and
operational principles and procedures they are no! using and create
entirely ne! ones.8 8+usiness reengineering means starting all over,
starting from scratch.8 80t means forgetting ho! !ork !as done...old
titles and old organi$ational arrangements...cease to matter. Ko!
people and companies did things yesterday doesnVt matter to the
business reengineer.8
8(eengineering...canVt be carried out in small and cautious
steps. 0t is an all"or"nothing proposition that produces dramatically
impressive results.8
T0 Co*&r%4u&%o*s o/ M%C 2!))r
7hen Kammer !as queried 8Ko! do managers contemplating a
big reengineering e9ort get everyone inside their company to 4oin upY8
he ans!ered in terms that reMect the violent point of vie! of all
e#tremists in ho! to achieve any progress. 8...Gn this 4ourney
!e...shoot the dissenters.8 The theme of turning destruction on your
o!n people remains a persistent motive. 8...0tVs basically taking an a#
and a machine gun to your e#isting organi$ation.8
0n vie! of the !idespread popularity of Kammer 0 !onder ho!
e#ecutives can subscribe to such ferocious vie!s !hile preaching
about individual empo!erment, team!ork, partnership, participative
management, kno!ledge"driven enterprise, learning corporation,
employee gain sharing, fello!"!orker trust, common bond, shared
values, people"oriented leadership, cooperation and long"term career
commitment.
0 usually match the ideas of ne! prophets !ith past patterns. 0t
helps to understand !hether the !hatVs proposed is repackaging of
!hat has been tried before. 0 fnd KammerVs sentence structure as !ell
as his dogmatic pronouncements as something that resonates !ith the
radical vie!s put forth by political hi4ackers like (obespierre, *enin,
ao and /uevara. Fust replace some of the nouns, and you can
produce slogans that have been attributed to those !ho gained po!er
by overthro!ing the e#isting order.
0t is no coincidence that the most !idely read book on
reengineering carries the provocative subtitle, 8, anifesto for
+usiness (evolution8 and claims to be a 8seminal8 book comparable to
,dam SmithVs The 7ealth of Cations " the intellectual underpinning of
capitalism. ,ll you have to remember is that there is another book, also
bearing the title 8anifesto,8 that successfully spread the premise that
the only !ay to improve capitalism is to obliterate it.
7hat is at issue here is much more than reenginering, !hich has
much to commend to itself. The question is one of morality of
commerce against the morality of !arfare.
The morality of !arfare, of vengeance, violent destruction and
the use of might has been !ith us every since primitive tribes had to
compete for hunting grounds. Societies have recogni$ed the
importance of !arfare by sanctioning a class that !as allo!ed, sub4ect
to some rules, to kill, !hile the redeeming code of loyalty and self
sacrifce for the good of all !ould prevail.
The morality of commerce has been !ith us at least since 622
+C. 0t is based on shunning force, coming up !ith voluntary
agreements, collaboration even !ith strangers and aliens, respecting
contracts and promoting e#changes that beneft both to the buyer and
the sellers.
Fust about every ma4or national tragedy in the last fe! centuries
can be traced to the substitution of the morality of !arfare for the
morality of commerce, under the guise that this !ill lead to greater
overall prosperity. ike KammerVs adoption of the non"redeeming
e#pressions of military morality have crossed the line !hat ought to be
acceptable. (eengineering is and should remain an activity in the
commercial domain and should be bound by its morality. *eave the
military language and thinking to those !ho have to deal !ith the
diLcult choices one faces !hen confronting the prospects of getting
shot at.
EDc&%A*ss o/ RAo$u&%o*!r' C0!*5s
0 have listened carefully to the e#tremists !ho are the most
prominent promoters of the proven old ideas no! repackaged as a
managerial innovation. Their !ell fnanced promotional e9orts have
succeeded in gaining at least temporary respectability for
8reengineering.8 0 have found that they have successfully translated
the radicalism of the 1HI2Vs, !ith its socially unacceptable slogan 8)o
not reform, obliterateQ8 into a fashionable, money"making proposition.
The clarion call for overthro!ing the status quo is similar to that
trumpeted by the radical students !ho occupied the )eanVs oLce. Co!
the same arguments can be fashioned into more lucrative consulting
services. 0f you ask !hat many of the radical proponents of
reengineering !hat they did !hile they !ere the -niversity during the
1HI2Vs, you !ill fnd a surprising number !ho pride themselves as
erst!hile anti"establishment 8revolutionaries.8
0f you look at political revolutionary movements back in time to
the 5rench (evolution, you !ill fnd their leaders motivated by a
f#ation on sei$ing po!er from the Astablishment under !hatever
slogan that could be sold to those !ho hoped to improve 4ustice,
freedom or proft. (evolutionary leaders in the past ;22 years, !ho
!ere mostly intellectuals !ho hardly ever delivered anything other
than pamphlets and speeches, have been consistent in making
conditions !orse after they take over the Astablishment. There is one
thing that all past revolutionary movements have in common !ith the
e#tremist vie!s of 8reengineering.8 0n each case, the leaders call for
complete and uncompromising destruction of the institutions as they
e#ist. 0t is only through this kind of attack on customs, habits and
relationships that ne!comers can gain inMuence !ithout much
opposition. The common characteristic of the elite that agitates
destructively for positions of leadership is an arrogance that they are
the only ones !ith superior insight !ho can be trusted in !hat to do.
0 am in favor of making evolutionary improvements in the !ay
people !ork. 0f you !ant to call that reengineering, thatVs G[, though 0
prefer to call it 8business process redesign8 because the other label
has become tainted by e#tremism. +esides, you cannot reengineer
something that has not been engineered to begin !ith. Grgani$ations
evolve because it is impossible to design comple# human relationships
as if they !ere machine parts.
7hat matters is not the label, but by !hat means you help
organi$ations to improve. The long record of miscarriages of centrally
planned radical reforms, and the dismal record of reengineering as
ackno!ledged by ike Kammer himself, suggest that an evolutionary
approach !ill deliver better and more permanent improvements.
V%3s o* Bus%*ss I)-roA)*&
*asting improvements in business processes can be made only
!ith the support of those !ho kno! your business. Creating conditions
for continuous, incremental and adaptive change is the primary task of
responsible leadership. Cut"backs that respond abruptly to a steadily
deteriorating fnancial situation are a sure sign that management has
been either incompetent or asleep.
Avolutionary change stimulates the imagination and the morale. 0t
creates conditions for re!arding organi$ational learning and for
inspiring employees to discover innovative !ays for dealing !ith
competitive challenges and !ith adversity.
)ismissing employees on a large scale, accompanied by
incentives for long"time employees to resign voluntarily, !ill paraly$e
those !ho are left !ith fear and an aversion to taking any initiatives. 0t
!ill force out those !ho are the most qualifed to fnd employment
else!here. Tou !ill end up !ith an organi$ation that !ill su9er from
self"inMicted !ounds !hile the competition is gaining on you. 0f you
lose your best people, you !ill have stripped yourself of your most
valuable assets. /etting rid of people because they have obsolete skills
is a reMection of past neglect of the organi$ation to innovate and learn.
*iquidating a company is easy and proftable, but somebody ought to
also start thinking about ho! to rebuild it for gro!th. That is the
challenge of leading todayVs losers to tomorro!Vs !inners.
Ko! do you perform business process redesign under adverse
conditionsY Ko! do you motivate your people to give you their best so
that they may prosper again, even though some positions of privilege
!ill change or cease to e#istY
Bus%*ss Procss R,s%5*
To be successful, business process redesign depends on the
commitment and imaginative cooperation of your employees. +usiness
process redesign must demonstrate that only by !orking together they
can improve their long"term opportunities. +usiness process redesign
relies primarily on the accumulated kno!"ho! of e#isting employees to
fnd conditions that !ill support the creation of ne! 4obs, even if that
means that in the short run many of the e#isting 4obs !ill have to
cease to e#ist.
0n business process redesign, the people directly a9ected by the
potential changes study the 8as"is8 conditions and propose 8to be8
alternatives to achieve the desired improvements. 0n business process
redesign everybody !ith an understanding of the business !ill be
asked to participate. A#ternal help is hired only for e#pertise that does
not already e#ist any!here internally.
+usiness process redesign calls for applying rigorous methods to
charting, pricing and process Mo! analysis of 8as"is8 conditions.
Process redesign is never fnished during the lifetime of a company.
,fter implementing any ma4or improvement ne! payo9 opportunities
!ill al!ays emerge from !hat has 4ust been learned. The primary
ob4ective of the business process improvement is to create a learning
environment in !hich rene!al and gain !ill be an ongoing process
instead of 4ust a one time shock therapy. ,dopting formal business
process Mo! methods and a consistent technique for keeping track of
local improvements allo!s combining later on processes that !ere
initially isolated for short"term delivery of local gains in productivity.
+usiness process redesign balances the involvement of
information managers, operating managers and sub4ect matter
e#perts. Cooperative teams are assembled under non"threatening
circumstances in !hich much time is spent and perhaps !asted in
discussing di9erent points of vie!. -nanimity is not !hat business
process is all about. )i9erences are recorded, debated and passed on
to higher levels of management for resolution.
+usiness process redesign requires that you perform a business case
analysis, !hich calculates not only payo9s but also reveals the risks of
each proposed alternative. This is not popular because the current
methods for performing business case analysis of computeri$ation
pro4ects call for calculations that do not have the integrity for making
them acceptable to fnancial e#ecutives.
The over!helming advantage of business process redesign, as
compared !ith 8reengineering,8 lies in its approach to managing
organi$ational change. The relatively slo! and deliberate process
redesign e9ort is more in tune !ith the approach that people normally
use to cope ma4or changes. Avery day should be process redesign day,
because that is ho! organi$ational learning takes place and that is ho!
you gain the commitment of your people. ,t each incremental stage of
process design, your people can keep up the pace !ith their leaders,
because they can learn ho! to share the same understanding of !hat
is happening to the business. They are allo!ed the opportunity to think
about !hat they are doing. They are not intimidated by precipitous
layo9s that inhibit their sharing of ideas ho! to use their o!n time and
talent more e9ectively.
C0!r!c&r o/ R*5%*r%*5
(eengineering, as currently practiced, primarily by drastic dictate
and !ith reliance on outsiders to lead it, assumes that your o!n people
cannot be trusted to f# !hatever ails your organi$ation. reengineering
accepts primarily !hat the e#perts, preferably ne!comers to the
scene, have to o9er.
0n reengineering the consultants !ill recommend to you !hat the
8to be8 conditions ought to look like, !ithout spending much time
understanding the reasons for the 8as"is8 conditions. The credo of
reengineering is to forget !hat you kno! about your business and start
!ith a clean slate to 8reinvent8 !hat you !ould like to be. 7hat applies
to individuals or nations, certainly applies to corporations. you can
never totally disregards your people, your relationships !ith
customers, your assets, the accumulated kno!ledge and your
reputation. Persions of the phrase 8...thro! history into the dustbin and
start ane!8 has been attributed to every failed radical movement in
the last t!o hundred years.
(eengineering proponents do not !orry much about formal
methods. They practice techniques of emergency surgery, most often
by an amputation. 0f amputation is not feasible, they resort to
tourniquet"like remedies to stopping the Mo! of red ink. (adical
reengineering may apply under emergency conditions of imminent
danger as long as someone considers that this !ill most likely leave us
!ith a patient that may never recover to full health again because of
demorali$ation of the !orkforce. 0t is much s!ifter than the more
deliberate approach of those !ho practice business process redesign.
Co !onder, the simple and quick methods are preferred by the
impatient and those !ho may not have to cope !ith the unforeseen
long term consequences on !hat happens to the quality and the
dedication of the !orkforce.
0n reengineering participation by most of the e#isting
management is superMuous, because you are out to 4unk !hat is in
place any!ay. -nder such conditions, for instance, bringing in an
e#ecutive !ho !as good in managing a cookie company to run a
computer company makes perfect sense.
0n reengineering debates are not to be encouraged since the goal
is to produce a masterful stroke of insight that suddenly !ill turn
everything around. ,utocratic managers thrive on an opportunity to
preside over an reengineering e9ort. reengineering also o9ers a ne!
lease on the careers of chief information oLcers !ith propensities to
forge ahead !ith technological means as a !ay of introducing
revolutionary changes. , number of spokesmen in recent meetings of
computer e#ecutives o9ered reengineering as the antidote to the slur
that C0G stands for 8Career 0s Gver.8
(eengineering conveys a sense of urgency that does not d!ell
on much fnancial analysis, and certainly not formal risk assessment.
anagers !ho tend to rely on bold strokes rebel against analytic
disciplines. 7hen it comes to business case analysis !e have the
traditional confrontation of the tortoise and the hare " the plodders vs.
the hip"shooters. Sometimes the hip"shooters !in, but the odds are
against them in an endurance contest.
(eengineering does not o9er the time or the opportunities for
the much needed adaptation of an organi$ation to changing conditions.
0t imposes changes s!iftly by fat, usually from a ne! collection of
people imported to make long overdue changes. Aven if the ne!
approach may be a superior one for 4arring an organi$ation out of its
ingro!n bad habits, it !ill be hard to implement because those !ho are
supposed to act di9erently !ill no! have a negative attitude to do their
creative best in support of the transition from the old to the ne!.
(eengineering has the advantage of being a choice of last resort
!hen there is no time left to accomplish business process redesign. 0n
this sense, it is akin to saying that sometimes dictatorship is more
e9ective than community participation. 7ithout probing !hy the
leadership of an enterprise ever allo!ed such conditions to occur, 0 am
left !ith a nagging doubt if the drastic cure does not ultimately end up
causing !orse damage than the disease.
Constitutional democracies, despite occasional reversals in
fortune, have never !illingly accepted dictatorship as the !ay out of
their troubles. Gn the other hand, the record of attempts to deal !ith
the crises in governance by drastic solutions is dismal. Though
occasionally you may fnd remarkable short term improvements,
e#treme solutions that have destroyed past accumulation of human
capital have al!ays resulted in vie!ing an era of violence as times of
retrogression.
)r. ichael Kammer, a assachusetts 0nstitute of Technology
computer sciences professor, and Fames Champy, Chairman of CSC
0nde#, gave ne! life and vigor to the concept of reengineering in the
early 1HH2s !ith the release of their book 7eengineering the
Corporation9 A Manifesto for usiness 7evolution& Co!, over a decade
old, +usiness Process (eengineering %+P(& is no longer the latest and
hottest management trend. Ko!ever, as +P( enters a ne! century, it
has begun to undergo a resurgence in popularity.
Companies have seen real beneft in evaluating processes before
they implement e#pensive technology solutions. , process can span
several departmental units, including accounting, sales, production,
and fulfllment. +y deconstructing processes and grading the activities
in terms of !hether or not they add value, organi$ations can pinpoint
areas that are !asteful and ineLcient. ,s organi$ations continue to
implement Anterprise (esource Planning %A(P& systems, they reali$e
that many systems !ere built based on departmental needs, rather
than being geared to a specifc process.
T0 Ess*c o/ &")
Kammer and Champy noted that in the business environment
nothing is constant or predictablefnot market gro!th, customer
demand, product life spans, technological change, nor the nature of
competition. ,s a result, customers, competition, and change have
taken on entirely ne! dynamics in the business !orld. Customers no!
have choice, and they e#pect products to be customi$ed to their
unique needs. Competition, no longer decided by 8best price8 alone, is
driven by other factors such as quality, selection, service, and
responsiveness. 0n addition, rapid change has diminished product and
service life cycles, making the need for inventiveness and adaptability
even greater.
This mercurial business environment requires a s!itch from a tas!
orientation to a process orientation, and it requires re"inventing ho!
!ork is to be accomplished. ,s such, reengineering focuses on
fundamental business processes as opposed to departments or
organi$ational units.
R*5%*r%*5 D+*,
8(eengineering is the fundamental rethinking and radical
redesign of business processes to achieve dramatic improvements in
critical, contemporary measures of performance, such as cost, quality,
service, and speed.8:4ammer and Champy/ ;<<=
T0 N!&%o*!$ Ac!,)' o/ Pu4$%c A,)%*%s&r!&%o* rc!s& &0%s
,+*%&%o* /or 5oAr*)*&"
,"overnment #usiness process reengineering is a radical
improvement approach that critically examines/ rethin!s/ and
redesigns mission product and service processes 3ithin a political
environment& It achieves dramatic mission performance gains from
multiple customer and sta!eholder perspectives& It is a !ey part of a
process management approach for optimal performance that
continually evaluates/ ad)usts or removes processes&, fC,P,, 1HH6
Some have argued that government activities are often policy
generators or oversight mechanisms that appear to add no value, yet
cannot be eliminated. They question ho! reengineering could have
applicability in the public sector. /overnment only di9ers from the
commercial sector in terms of the kinds of controls and customers it
has. 0t still uses a set of processes aimed at providing services and
products to its customers.
T0 Pr%*c%-$s o/ R*5%*r%*5
0n Kammer and ChampyDs original Manifesto reengineering !as
by defnition radical: it could not simply be an enhancement or
modifcation of !hat !ent before. 0t e#amined !ork in terms of
outcomes, not tasks or unit functions, and it e#pected dramatic, rather
than marginal improvements. The authors suggested seven principles
of reengineering that !ould streamline !ork processes, achieve
savings, and improve product quality and time management.
SA* -r%*c%-$s o/ r*5%*r%*5
1. Grgani$e around outcomes, not tasks.
;. 0dentify all processes in an organi$ation and prioriti$e them in
order of redesign urgency.
B. 0ntegrate information processing !ork into the real !ork that
produces information.
@. Treat geographically dispersed resources as though they are
centrali$ed.
6. *ink parallel activities in the !orkMo! instead of 4ust integrating
their results.
I. Put the decision point !here the !ork is performed, and build
control into the process.
O. Capture information once and at the source.
T0 B*+&s o/ R*5%*r%*5
The hard task of re"e#amining mission and ho! it is being delivered
on a day"to"day basis !ill have fundamental impacts on an
organi$ation, especially in terms of responsiveness and accountability
to customers and stakeholders. ,mong the many re!ards,
reengineering.
Ampo!ers employees
Aliminates !aste, unnecessary management overhead, and
obsolete or ineLcient processes
Produces often signifcant reductions in cost and cycle times
Anables revolutionary improvements in many business processes
as measured by quality and customer service
Kelps top organi$ations stay on top and lo!"achievers to become
e9ective competitors.
R*5%*r%*5" A Fu*c&%o*!$ M!*!5)*& A--ro!c0
0mplementation of a reengineering initiative usually has
considerable impact across organi$ational boundaries, as !ell as
impacts on suppliers and customers. (eengineering can generate a
signifcant change in.
Product and service requirements
Controls or constraints imposed on a business process
The technological platform that supports a business process.
5or this reason, it requires a sensitivity to employee attitudes as !ell
as to the impact of change on their lives.
J0!& %s ! 4us%*ss -rocssK
,A #usiness process is a structured/ measured set of activities
designed to produce a specifed output for a particular customer or
mar!et&,
S$c&%*5 ! -rocss
7ise organi$ations !ill focus on those core processes that are
critical to their performance, rather than marginal processes that have
little impact. There are several criteria reengineering practitioners can
use for determining the importance of the process.
0s the process brokenY
0s it feasible that reengineering of this process !ill succeedY
)oes it have a high impact on the agencyDs strategic directionY
)oes it signifcantly impact customer satisfactionY
0s it antiquatedY
)oes it fall far belo! 8+est"in"Class8Y
)o) has suggested that the follo!ing si# tasks be part of any
functional management approach to reengineering pro4ects.
1. D+* &0 /r!)3orC. )efne functional ob4ectives: determine
the management strategy to be follo!ed in streamlining and
standardi$ing processes: and establish the process, data, and
information systems baselines from !hich to begin process
improvement.
;. A*!$';. ,naly$e business processes to eliminate non"value
added processes: simplify and streamline processes of little
value: and identify more e9ective and eLcient alternatives to
the process, data, and system baselines.
B. EA!$u!&. Conduct a preliminary, functional, economic analysis
to evaluate alternatives to baseline processes and select a
preferred course of action.
@. P$!*. )evelop detailed statements of requirements, baseline
impacts, costs, benefts, and schedules to implement the
planned course of action.
6. A--roA. 5inali$e the functional economic analysis using
information from the planning data, and present to senior
management for approval to proceed !ith the proposed process
improvements and any associated data or system changes.
I. EBcu&. A#ecute the approved process and data changes, and
provide functional management oversight of any associated
information system changes.
E*sur%*5 R*5%*r%*5 Succss
uch research has been conducted to determine !hy many
reengineering pro4ects fail or miss the mark. )o) has indicated that
organi$ations successful in reengineering planning have a number of
common traits.
They are strongly supported by the CAG
They break reengineering into small or medium"si$ed elements
ost have a !illingness to tolerate change and to !ithstand the
uncertainties that change can generate
any have systems, processes, or strategies that are !orth
hiding from competitors.
S%B cr%&%c!$ succss /!c&ors /ro) 5oAr*)*& B-r%*c
0n a publication for the Cational ,cademy of Public ,dministration,
author )r. Sharon *. Caudle identifed si# critical success factors that
ensure government reengineering initiatives achieve the desired
results.
1. U*,rs&!*, r*5%*r%*5.
o -nderstand business process fundamentals.
o [no! !hat reengineering is.
o )i9erentiate and integrate process improvement
approaches.
;. Bu%$, ! 4us%*ss !*, -o$%&%c!$ c!s.
o Kave necessary and suLcient business %mission delivery&
reasons for reengineering.
o Kave the organi$ational commitment and capacity to
initiate and sustain reengineering.
o Secure and sustain political support for reengineering
pro4ects.
B. A,o-& ! -rocss )!*!5)*& !--ro!c0.
o -nderstand the organi$ational mandate and set mission"
strategic directions and goals cascading to process"specifc
goals and decision"making across and do!n the
organi$ation.
o )efne, model, and prioriti$e business processes important
for mission performance.
o Practice hands"on senior management o!nership of
process improvement through personal involvement,
responsibility, and decision"making.
o ,d4ust organi$ational structure to better support process
management initiatives.
o Create an assessment program to evaluate process
management.
@. M!sur !*, &r!cC -r/or)!*c co*&%*uous$'.
o Create organi$ational understanding of the value of
measurement and ho! it !ill be used.
o Tie performance management to customer and stakeholder
current and future e#pectations.
6. Pr!c&%c c0!*5 )!*!5)*& !*, -roA%, c*&r!$
su--or&.
o )evelop human resource management strategies to
support reengineering.
o +uild information resources management strategies and a
technology frame!ork to support process change.
o Create a central support group to assist and integrate
reengineering e9orts and other improvement e9orts across
the organi$ation.
o Create an overarching and pro4ect"specifc internal and
e#ternal communication and education program.
I. M!*!5 r*5%*r%*5 -roQc&s /or rsu$&s.
o Kave a clear criteria to select !hat should be
reengineered.
o Place the pro4ect at the right level !ith a defned
reengineering team purpose and goals.
o -se a !ell"trained, diversifed, e#pert team to ensure
optimum pro4ect performance.
o 5ollo! a structured, disciplined approach for reengineering.
A--$'%*5 r(*5%*r%*5 -r%*c%-$s &o 0!$&0 c!r
+usiness process re"engineering has its roots in commercial
manufacturing. )evelopment !ork in the 1HO2s and 1HJ2s in a range
of commercial settings sho!ed signifcant benefts from a systematic
approach to the analysis and restructuring of manufacturing processes.
0t !as !idely adopted as a means of improving manufacturing output
to produce signifcant improvements in quality, capacity and cost. The
approach attracted the interest of managers in the CKS and t!o
pro4ects %at *eicester (oyal 0nfrmary and at [ings Kealthcare in
*ondon& !ere funded by the )epartment of Kealth to test its
application in a health care setting.
The !ork started in *eicester in 1HH@. 0t involved a signifcant
programme of 1@2 separate pro4ects. , *ramewor/ for 3e4ning
Success !as established to ensure that the impact of the !ork in its
!idest sense could be measured. Gver the last fve years signifcant
gains have been made in the quality of services o9ered to patients, as
!ell as in teaching and research. 0ndeed, fe! departments in the
hospital !ere untouched by the initiative.
The key lesson from the !ork at *eicester has been that change
is typically created bottom"up in contrast to the top"do!n approach
championed by the academic supporters of re"engineering. Clinical and
management leaders have to create the right conditions for
improvement. (edesigning health care di9ers in signifcant !ays from
that !hich can be applied in industrial settings. it involves several
distinct steps.
g 0dentifying specifc patient groups " targets for service process
redesign.
g Ansuring that those involved in service provision are involved in
service
redesign.
g +eing clear about the tools and techniques available.
g ,nalysing the current process to identify strengths and !eaknesses.
!hat adds
value and !hat doesnVtY
g Creating a model for the redesigned service.
g Astablishing performance measures.
g Testing the ne! process " being honest " does it or doesnVt it !orkY
g Then )G0C/ 7K,T 7G([S.
*eicester (oyal 0nfrmary has created a tool"kit that describes the
tools and techniques used for patient process redesign. The tool"kit
provides the basis for a series of 7e1engineering Masterclasses that
have attracted clinical and managerial interest !ithin the -[ and
internationally, !ith visitors from health services in Ce! Sealand,
S!eden and )enmark taking part. The *eicester (oyal 0nfrmaryVs
dissemination !ork has been recognised !ith the granting of specialist
*earning Centre status, thus confrming their role as an integral part of
the gro!ing CKS *earning
Us%*5 4us%*ss -rocss r(*5%*r%*5 -r%*c%-$s %*
,uc!&%o*!$ r/or)K
I*&ro,uc&%o*
The ob4ective of this paper is to apply business re"engineering
principles to reform primary and secondary education. 0n particular,
using information technology %especially telecommunications and
net!orking&, educational reforms can be proactively accomplished
despite the dynamic environment and demands.
A9orts to reform education through information technology
%Corcoran, 1HHB& have entered the mainstream of society and of the
corporation. (eforming education through information technology
bears a remarkable resemblance to e9orts to reform business
organi$ations through information technologyQ %+usiness 7eek, ,pril
1HJB& 0t is therefore appropriate to re"e#amine educational reform in
terms of businessV language and concepts as used in business process
re"engineering. (e"engineeering strives to break a!ay from the old
!ays and rules about ho! !e organi$e and conduct business. 0t
involves recogni$ing and re4ecting some of the old !ays and then
fnding imaginative ne! !ays to accomplish !ork. %Kammer, pp. 12@"
126& 0n this !ay, !e might learn lessons from the corporate e#perience
to apply information technology to reform educational structure. This
perspective may also enable leaders of the corporate community to
better understand the conte#t of educational reforms and their
necessary role in promoting and assisting those reforms.
Can !e apply the language %and e#perience& of business
process re"engineering to educational reformY 0n his landmark paper
on re engineering, Kammer %p. 126& asserts.
0n a time of rapidly changing technologies and ever" shorter
product life cycles, product development often proceeds at a glacial
pace.
0n an age of the customer, order fulfllment has high error rates
and customer inquiries go unans!ered for !eeks.
0n a period !hen asset utili$ation is critical, inventory levels
e#ceed many months of demand. Small changes in !ording to adapt
these assertions to education reveal a remarkable analogyQ
0n a time of rapidly changing history and ever"shorter political
and economic cycles, curriculum development often proceeds at a
glacial pace.
0n an age of keen competition and higher standards, student
achievement has high failure rates and student needs go unans!ered.
0n a period of limited resources, educational costs continue to
climb but are often a diminishing proportion of infrastructure
investment. These analogies should therefore provide us !ith ne!
perspective to re"engineer education using advanced information
technology.
R(*5%*r%*5 -r%)!r' !*, sco*,!r' ,uc!&%o*
The !orld has changed, but education hasnVt necessarily
adapted to these changes. ,t a recent PrincipalsV Conference in
Singapore, Fohn Tip, )irector of Aducation, !as quoted %*eong&.
80t is crucial that !e have a good education system !hich is
relevant to the times. Change is inevitable.... Kelp students to develop
attitudes and skills !ith !hich they can independently seek kno!ledge,
process information and apply it to tackle issues.8
7e still have 8industrial age8 schools that are unable to meet
the needs of our emerging 8information age8 societyQ )avis %p. ;@&
claims that all organi$ations based on the industrial model are created
for 8businesses8 that either no longer e#ist or are in the process of
going out of e#istence.
,gain, quoting Kammer %p. 12O&, !e can also dra! another
analogy bet!een the business climate and the educational climate.
Quality, innovation, and service are no! more important than
cost, gro!th, and control.
0t should come as no surprise that our business processes and
structures are outmoded and obsolete. our !ork structures and
processes have not kept pace !ith the changes in technology,
demographics, and business ob4ectives.
,gain, small changes in !ording to adapt these statements to
education reveal a remarkable analogyQ
Quality, innovation, and creativity are no! more important than
cost and standardi$ed test scores.
0t should come as no surprise that our school processes and
structures are outmoded and obsolete. our teaching structures and
processes have not kept pace !ith the changes in technology,
demographics, and societal conditions.
E,uc!&%o*!$ -ro4$)s
Corcoran %p. II& remarks that 8net!orks are changing the !ay
teachers teach and students learn.8 Can !e apply net!orking to re"
engineer primary and secondary educationY 7hat are the problems of
education today in our dynamic contemporary !orldY
(ecogni$ing the traditional isolation of teachers %and students&,
Ce!man %p. @H& argues that !e must make a choice bet!een systems
that %merely& deliver traditional instruction from a central repository
and systems that enable teachers and students to access and gather
information from distributed resources and communities. The
e#perience of teacher Sandra cCourtney %Corcoran, p. IO&
demonstrates that a net!ork can bring children the e#citement of the
outside !orld. Aven independent research by students is possible as
recogni$ed by +ob Kughes %Corcoran, p. II&, +oeingVs corporate
director of education relations, !ho sees computer net!orks as key to
turning out students !ho adapt to change and !ho solve problems by
seeking out and applying ne! ideas.
0n one of the recent Mood of articles on net!orking in the
mainstream press, arko9 laments inequities such as )i9erent levels
of access bet!een information 8have8 vs. 8have"not8 and Pre4udices
due to professional rank, gender, race, religion, national origin, or
physical ability.
Kunter %p. @@& o9ers us hope that assumptions of the present
educational system !here some learners and populations are
8underserved8 because they live in particular places, and that learning
opportunities are necessarily tied to local resources, are open to
rethinking in a highly net!orked environment. ,s a progressive force
for change, equity, and restructuring primary and secondary
education, information technology has been o9ered as a mechanism
for fostering change. %/illman, 1HJH& ore specifcally, many
proponents have identifed net!orking as a mechanism for change. 0n
particular, e9orts to promote the -S Cational (esearch and Aducation
Cet!ork %C(AC& for use in primary and secondary education have been
most representative of this point of vie!Q Perhaps, the most ambitious
e9ort is the Cational School Cet!ork Testbed %+ernstein, et. al.&, a
national research and development resource in !hich schools, school
districts, community organi$ations, state education agencies,
technology developers, and industry partners are e#perimenting !ith
applications that bring signifcant ne! educational benefts to teachers
and students. The Consortium for School Cet!orking %CoSC& has been
most active in promoting this movement through its on"line 0nternet
discussion %cosndischbitnic.educom.edu& and other activities, e.g.
gopher cosn.org . 5or membership information, send mail to
infohcosn.org .
0ndeed, the need for educational reform is generally
recogni$ed. ,pplying the concept of internet!orking to educational
innovation, it becomes possible for every individual and group involved
in educational change and research to be a direct contributor to the
collective process of innovation. A#amples of opportunities for direct
contribution include %Kunter, p. @@&.
0mproved communications among school district personnel
and Sharing e#pertise among teachers of di9erent disciplines and
geographical locations. Critical shifts in application of information
technology
The literature on organi$ational change and the future abounds
!ith dramatic predictions of the need for organi$ations to adapt to
profound change. Sproull and [iesler %p. 11I& claim that the net!orked
organi$ation di9ers from the conventional !orkplace !ith respect to
both time and space so that managers can use net!orks to foster ne!
kinds of task structures and reporting relationships. )avis claims that
!hile the ne! economy is in the early decades of its unfolding,
businesses continue to use organi$ation models that !ere more
appropriate to previous times than to current needs. %p. 6&
0n terms of information technology, Tapscott and Caston %pp.
1@"1O& identify organi$ational changes that are enabled by information
technology and net!ork access, in particular. Cet!orking enables the
informal !eb of relations people developed !ith each other inside the
organi$ation %)avis, p. JI& so as to get things done. *ike!ise, e#amples
of ho! educational organi$ations might adopt these net!ork
innovations are not diLcult to imagine. Kunter %1HHB& provides many
e#amples of ho! net!ork access changes the nature of teaching and
learning. Kunter %p. @;& claims that ne! models of learning and
teaching are made possible by the assumption that learners and
teachers as individuals and groups can interact !ith geographically
and institutionally distributed human and information resources.

I*&5r!&, or5!*%;!&%o*
7ith the evolution from system islands to integrated systems,
net!ork access enables inter"disciplinary instruction. Cet!ork access
8Mattens8 the instructional development process by giving teachers
access to previously inaccessible information and teaching resources.
Kunter %p. @;& speculates that application of the concepts and
technology of internet!orking may make it possible for separate
reform e9orts of diverse groups and individuals to contribute to the
building of a ne! educational system providing more accessible,
higher"quality learning opportunities for everyone.

EB&*,, *&r-r%s
7ith the evolution from internal to inter"enterprise computing,
more people, e.g. parents and business people, !ill become active in
schools by 8dropping in8 electronically for a short time every day.
5urthermore, students !ill leave the confnes of the classroom and
make electronic visits to museums, libraries, businesses, and
governments around the !orld. )oes business process re"engineering
model ft educational problemsY
So, ho! ought !e to apply the re engineering model to reform
educationY Kammer %pp. 12J"111& o9ers principles of re engineering.
Could these principles be applied to educationY *etVs seeQ Grgani$e
around outcomes, not tasks Kave one person perform all the steps in a
process and design that personVs 4ob around an ob4ective or outcome
instead of a single task %Kammer, p. 12J&
0n the business sense, the idea %Kammer, p. 12I& is to s!eep
a!ay e#isting 4ob defnitions and departmental boundaries and to
create a ne! position through empo!erment.
0n the !orld of educational telecommunications, the e#perience
of teacher Ad +arry %Corcoran, p. IJ& reveals that the role of teacher
changes to 8manager, not a dispenser of information8 because the
teacher is empo!eredQ Kave those !ho use the output of the process
perform the process Gpportunities e#ist to re engineer processes so
that the individuals !ho need the result of a process can do it
themselves %Kammer, p. 12H&
0n the business sense, !hen the people closest to the process
perform it, there is little need for the overhead associated !ith
managing it %Kammer, p. 12H& +y the same token, [ay %p. 1@I& has
discovered that children learn in the same !ay as adults, in that they
learn best !hen they can ask questions, seek ans!ers in many places,
consider di9erent perspectives, e#change vie!s !ith others and add
their o!n fndings to e#isting understandings.
Subsume information"processing !ork into the real !ork that
produces the information
ove !ork from one person or department to another %Kammer, p.
112&
Ampo!er students to search for the 8ans!ers8 in heretofore
inaccessible places. ,s a means to reduce the isolation of classroom
teachers, Kunter %1HHB, p. @B& claims that a thread !oven throughout
most net!orked learning innovations is the idea that schooling can be
more closely linked to !ork in the real !orld.
Treat geographically dispersed resources as though they !ere
centrali$ed
-se databases, telecommunication net!orks, and standardi$ed
processing systems to get the benefts of scale and coordination !hile
maintaining the benefts of Me#ibility and service %Kammer, p. 112&
-se databases, telecommunication net!orks, and computer"
supported course!are to get the benefts of sharing curriculum
development !hile maintaining the benefts of individuali$ed learning
and customi$ation. *ink parallel activities instead of integrating their
results
5orge links bet!een parallel functions and coordinate them
!hile their activities are in process rather than after they are
completed %Kammer, p. 112&
Gften, separate units perform di9erent activities that must
eventually come together. 5or e#ample, curriculum developers often
prepare instructional materials independently for teachers to use.
0nstead, enabling teachers and students to communicate easily !ith
curriculum developers during development and testing of materials
ought to lead to better materials produced in a shorter time. Put the
decision point !here the !ork is performed and build control into the
process People !ho do the !ork should make the decisions and that
the process itself can have built"in controls %Kammer, p. 111&
0n general, !e should 8empo!er8 teachers and studentsQ 5or
e#ample, opportunities e#ist to re engineer teaching so that teachers
can tap the e#pertise of curriculum developers and sub4ect matter
e#perts. Then, teachers can become self" managing and self"
controlling. 0n a pro4ect called *earning Through Collaborative
Pisuali$ation %Kunter, p. @B&, students and teachers are !orking
directly !ith scientists at the -niversity of ichigan, the A#ploratorium
%museum& in San 5rancisco, the Cational Center for Supercomputer
,pplications in -rbana"Champaign %0llinois, -S,&, and the
Technical Aducation (esearch Center %Cambridge, , -S,& on inquiries
in atmospheric science, using t!o"!ay audio"video technology being
developed by +ellcore and ,meritech.
Curr*& rs!rc0 Dor&s
0n hope of making a case for the reforms described here, t!o
research pro4ects on educational telecommunications are
e#perimenting !ith these principles. Common [no!ledge.
PittsburghCommon [no!ledge. Pittsburgh is a -S Cational Science
5oundation"funded pro4ect to test the impact of 0nternet access
on the Pittsburgh %Pennsylvania& Public Schools. Singapore pilot pro4ect
SingaporeVs inistry of Aducation is pioneering 0nternet access in
several 4unior colleges %grades 11"1;& and a secondary school. These
pro4ects are conducting e#periments to address %through
telecommunications& the educational problems described earlier.
Collaborative e9orts
Collaboration bet!een these international partners is intended
to enable a comparative evaluation of the impact of educational
telecommunications on t!o very di9erent educational systems. The
-nited States is generally recogni$ed for its stronger climate for
innovation !ith notable educational e#periments such as.
,pple Pivarium Program %[ay&
Cityspace %arko9&
Gn the other hand, Singapore and other ,sian nations
%Kirsch& are generally recogni$ed for their stronger climate
for teaching the fundamentals.
Dos &0 )o,$ +&K
(e engineering triggers changes of many kinds, not 4ust of the
business process itself. Fob designs, organi$ational structures,
management systems"anything associated !ith the process"must be
refashioned in an integrated !ay. 0n other !ords, re engineering is a
tremendous e9ort that mandates change in many areas of the
organi$ation. %Kammer, p. 11;& Surely, primary and secondary
education deserve the same attention and information technology has
as much potential to reorgani$e education as !ell as !orkQ
The business re"engineering model is remarkably apt for
educational reform. Perhaps, this novel %and some!hat provocative&
approach may encourage fresh ideas in this diLcult task.
SUMMARY
The importance and indispensability of control in the production
process is emphasi$ed in this unit. The Statistical Process Control has
its o!n evolution character and that is prescribed. Parious control
charts along !ith their applications are dealt elaborately. The process
capability and its signifcance for bringing out a quality product are
discussed in detail. The concept of si# sigma, the methodology of
adopting them are presented for the use of the readers. +ill Smith, the
father si# sigma has evolved the concept and its application in
di9erent industries and their outcome are placed for the consumption
of the readers. The reliability concepts, their importance are e#plained
!ith application in various industries. Product *ife Characteristics
Curve !ith its phases and quality requirements are deliberated. The
Total Productive aintenance has lot of overlapping on TQ. The eight
pillars of TQ, vi$ tha 6S Components, Fishu Ko$en %,utonomous
aintenance&, [ai$en, Planned aintenance, Quality aintenance,
Training, GLce TP, Safety, Kealth and Anvironment are elaborated for
better understanding. The *ife"Cycle Costing, other!ise popularly
kno!n as terotechnology is deliberated !ith a focus on ho! to reali$e
it. The +usiness Process (eengineering, fundamentals and methodolgy
are handled in this unit. )eliberations on !hether +P( is a fad or
rebirth of scientifc management is also conducted. The reengineering
process is elaborately dealt in con4unction !ith +P(. A#amples on
various sectors are also highlighted in this.
REVIEJ #UESTIONS
1. A#plain !hy the statistical process control is of utmost
signifcance to the quality ensuring process.
;. 7hat are the types of Control Charts and e#plain the
construction of any one of themY
B. Kighlight the meaning, signifcance and measurement of process
capability.
@. 7hat is ),0C and ),)PY A#palin its steps.
6. A#plain the contributions of +ill Smith and e#plain ho! it is used
in cost saving.
I. )escribe the process of process capability measurement.
O. A#plain the role of TP on product life cycle.
J. )etail the steps in the introduction of TP in an organi$ation.
H. 7hat is *ife Cycle CostingY -sing e#ample, demonstrate it.
12. <+P( ' a rebirth of scientifc management= ' Critically
e#amine.
11. )iscuss the criticisms and benefts of re"engineering.