The issue of ensuring quality in manufacturing is eternal. What changes are the complexities of these issues and how decision makers respond to them. Market-leading companies are developing a model of operational excellence that aligns financial and operational objectives with the right mix of people, processes, and technologies. These resources are essentially a tool belt for battling and foreseeing the adversities that emerge in everyday operations.
Within this operational excellence framework, it’s important to note that the capabilities of people, processes, and technologies should be viewed as dynamic. People today, for instance, bring a wealth of intellectual capital, such as Six Sigma certifications, that help them better understand and use operational metrics. Similarly, the automation of processes has much stronger drill-down functionalities, and emerging technologies are connecting data at an enterprise level.
With the nature of rapid change in these resources, it’s understandable that executives may not be entirely up to date or use the latest technological trends. Highlighted below are five of the biggest mistakes decision makers are making in quality management strategies that may be keeping their company from reaching operational excellence.
1. Underutilized operational and quality metrics
Executives and plant managers constantly reference metrics in meetings and discussions, but not all of them are leveraging their full potential. Unfortunately, many companies are underutilizing the power of these metrics, falling behind relative to competitors without realizing it because they don’t have the ability to benchmark. By integrating a system for measuring progress into your operational excellence framework, you can benchmark and prioritize areas that are most affecting your business performance. Some notable metrics include cost of quality, overall equipment effectiveness, and new products introduction.
2. Disconnected quality management systems
There are many enterprise applications available as well as solutions that tailor specific functionalities. Although companies implement software to increase visibility, by choosing disparate applications for each part of the value chain, organizational communication can become more difficult. Further complicating things, merging and acquisition activities can create compatibility issues, which are not always resolved immediately. Enterprisewide standardization and technology interoperability should be a main focus in creating strategic objectives. Enterprise quality management software (EQMS) is beneficial here.
3. Siloed manufacturing data
Executives and plant managers ideally want a system in place that provides data granularity that can be monitored in one central location. Internally (e.g., products, production lines, and plants) and externally (e.g., up and downstream activities), more visibility allows for cross-functional conversations and decision making. Many organizations lack the ability to have informed discussions on how various parts of the value chain interact with one another and can be improved. Again, enterprise applications such as EQMS and enterprise resource planning can provide more clarity for manufacturers.
4. Inconsistent leadership support
Whether it’s regarding safety, sustainability, quality, or other areas, any initiative needs support from the top down. Some companies, for instance, attempt to enhance quality capabilities with an EQMS and fail because support for the enterprise-level implementation did not span across the enterprise. For a quality initiative, executive buy-in is imperative for its success. It must be catalyzed from the top by a change in culture, rewards and incentive programs, internal marketing campaigns, and employee education programs. 5. Reactive instead of proactive Leading manufacturers tend to stay ahead because decision makers aren’t just using their resources to perform well; they’re using them as a proactive tool that looks into the future. Companies that fall behind are often not up to date on changing industry trends and regulations and aren’t properly leveraging maintenance technologies for equipment. To rectify these issues, executives and plant managers can join industry associations to stay ahead of the news and changes. Also, they can implement preventive maintenance capabilities, measuring their progress with metrics such as the Overall Equipment Effectiveness (OEE) formula, which is a comprehensive method of measuring the performance of a particular manufacturing unit. OEE accounts for availability, efficiency, and quality, and its measurement has proven to be greatly beneficial to leading manufacturers.
By not taking advantage of the growing capabilities of people, processes, and technologies, manufacturers are at risk of falling behind. Metrics, quality management systems, manufacturing data, leadership, and proactivity should all have a stake in your operational excellence framework. As mentioned, EQMS can facilitate and even enhance many of these areas. LNS Research’s recent Research Spotlight, Enterprise Quality Management Software Best Practices Guide, touches on how decision makers can build EQMS and quality into their operational excellence framework.
This article first appeared online on July 25, 2012, at Quality Digest Daily, a Kaizen Institute Online partner.