1. Explain how you would go about identifying the root cause (s) by proposing the use of appropriate tools and techniques.
2. You will propose a plan to eliminate or reduce the root cause (s) taking into considerations the resources that are required.
3. Develop a continuous improvement plan to ensure the problems and issues are not repeated.
Latino Engineering is faced with monstrous challenges, coming just twelve months after the company founder, Dominic Latino sold the company to the current owners, an investment group. The driving force behind Dominic Latino selling the company that he had successfully run for 30 years was the fear of losing control of the company, especially in decision making and controlling quality, if he had accepted the initial offer of the investors (current owners) buying shares in his company. Latino Engineering has over the years built a strong reputation for quality products, with many clients in diverse industries including oil and gas, infrastructure, manufacturing, and construction praising the company for its quality and reliable engineering products. The quality standards were driven mainly by the passion of the founder, Dominic, who had a passion for quality engineering products. At present, things have changed drastically; there are various problems that are a major threat to Latino Engineering. This is partly due to leadership; while the new owners retained the name of the company and its employees, some managers left to seek greener pastures while the founder also retired, resulting in changes in leadership positions. At present, Latino Engineering is facing the following problems and complaints from her customers;
- Defective engineering equipment
- Poor design and development follow up with clients
- Too long turnaround time for issue resolution
- Non responsive customer service team
- Cases of wrong engineering equipment was packaged and delivered to clients
Based on this brief background, the Latino Engineering Company is seeking ways pf solving these problems and continuously improving their product and service offering. This report gives a plan for how Latino Engineering will improve continuously, its service and product offering. The report will first discuss a framework for identifying the problems by evaluating processes, organization structure and culture, technology, and information aspects of the company (The POTI framework) which will give a blueprint for CI (continuous improvement). This will then be followed by an application of suitable tools (the 7 QC Tools) for use in monitoring interventions and progress; the information provided by the 7 QC Tools will enable management to make sound decisions based on structural facts and figures. The report then proposes a framework for achieving continuous improvement by employing the technique of Kaizen to ensure continuous improvements to service and product delivery by Latino Engineering. This project will be implemented using the Agile project management framework
Continuous Improvement Plan (CIP)
The blueprint for Latino Engineering will be developed using the OTI framework to identify present causes of problems and to create a vision for Latino Engineering that will entrench CI into its organizational and operational culture.
The existing processes at Latino Engineering will be evaluated with the aim of introducing new ones through this project. Tye operational business models presently used at POTI must be reviewed and changed in line with the new operational and strategic goal of CI. The output and performance levels of employees are to be evaluated and improvements made using the CIP framework (Kenton 2005). New ways of working will be introduced; including a structured way of designing projects, making follow-up and improvements in project design, establishing performance metrics for handing customer concerns, and improved customer service through a customer centered approach to customer service. Old ways of working, such as too much time in resolving customer issues, poor communication and lack of follow up in product design and development with the customer, along with the present design principles will be changed/ phased out as advised by Djella and Gallouj (2011).
Presently, there is a culture of complacency and lack of focus on quality at Latino Engineering as the currently problems show. The most important asset the company has are its people and change must start by changing the people; how they think and how they work, before implemented changes can take effect (Jain 2001). Apart from the culture, the skills set of employees and especially managers will be evaluated and changes made, along with the levels of staff to ensure there are enough employees to meet customer needs. For instance, the customer service department may be unresponsive to customer needs because they are understaffed and overwhelmed by the deluge of customer complaints. From the evaluation, some employees may be moved to other roles or be trained in other roles so they can help out when the demand is high. The training needs will also be assessed and proposals made to improve on their training needs (Feigenbaum 1992).
The existing technology systems will be evaluated, and proposals made for changes that will harness the power of technology for communication, reporting, monitoring, and collaboration to enhance product and service delivery. New computer systems will be put in place and changes made to present technology systems. New tool sets and networks will be put in place and necessary plant equipment to improve product design will also be put in place, as alluded to by Cruz-Cunha (2010)
This will entail evaluating the existing data and information systems and their impact in the delivery of quality products and services. With new technology systems and automation, information systems must also be improved. In this area, better design principles such as the use of Computer Aided design and simulation software applications will be implemented (Cassidy & Guggenberger 2001). The information systems will also be configured to provide better reporting and reports that management will use to monitor progress and performance. Customer relationship systems will be introduced to enhance customer service delivery through providing a better system for managing, tracking, and following up on customer issues. The new systems and tools will be developed to enhance collaboration, between teams and between the teams and customers, especially during product design and development (Tavana, Szabat &Puranam 2017). New data requirements will also be incorporated into the system, for instance, the need to fed all customer contacts into the customer relationship system to identify patterns and continuously improve them. Data outcomes for project specific activities will also be incorporated into the new information system
To achieve these visions and improve the company at all levels and in all processes, suitable tools are required to generate data and information for managing progress of the POTI framework and help in informed decision making.
Tools for CIP
The Seven Basic Tools for Quality and Continuous Improvement (7 QC)
The PMBOK (Project Management Body of Knowledge) incorporated the 7 QC tools into quality management in projects as basic tools that anyone can use, even those with minimal skills in managing projects. These tools can be used in any industry and sector and across the entire organization. The following are the 7 QC tools;
- Stratification (Dividing and Conquering)
- Cause and Effect Diagram (Fishbone diagram)
- The Check Sheet (Tally Sheet)
- Pareto Chart
- Scatter Diagram
- Control Chart (Revelle & Margetts 2010)
These are then discussed below in detail and how and why they will be used for the Latino Engineering CIP
This is a divide and conquer approach to CIP that involves the division of data into sub categories based on division, group, levels, or class and this helps in deriving meaningful information that will help in better understanding the existing systems (Shiba, Walden, Graham & Petrolini 2007). Stratification will divide data and conquer their meaningful information with the goal of solving the Latino Engineering problems. Present data, such as customer service follow up calls are unstratified if the records show, for example, that one employee failed to make a follow up call on various dates. This data can be stratified by grouping the information into weeks and knowing the frequency. This will help determine the frequency of occurrence of some phenomena, such as knowing the frequency of a specific fault being found in a product.
According to Mohanty (2008) , this is a bar graph that represents the frequency of all bars distribution; the histogram will be used in studying the data density in given distributions and comprehend the factors that are more often repeated. The histogram is important in managing projects because it helps in prioritization of issues. Without prioritization, effort may be placed on issues that do not have much impact on problems, and ignoring the crucial cause agents for problems. With the histogram, the areas the require the most attention immediately are identified and tackled.
The Check Sheet (Tally Sheet)
The Tally sheet/ Check sheet is a structured table, metrics, of a form used primarily for data collection with a view to analyzing this information (Land, Smith & Walz 2012). The information on causes and issues at Latino Engineering will be collected using the tally sheets; quantitative information will be collected, such as the number of customer information in a given time period. The check sheet will be utilized in listing down important events and checkpoints in metrics tabular formats; these information must keep on being updated and then marking their status of how they occur that will help in the understanding progress; the causes for defects and patterns for defects will also be understood better through the use of these check sheets.
The cause and effect diagram is a tool that will be used to help identify the factors and causes for the problems that Latino Engineering is undergoing at the moment, that lead to those effects (the problems). The cause and effect diagram will also aid in deriving relationships between the cause and effect factors that can be used meaningfully as a basis for making changes and adjustments. The cause and effect diagram is a very useful tool that will aid in identifying the root causes for all the problems being experienced at Latino Engineering. After the definition of a problem related to quality, the factors that cause the identified problems, such as defective engineering products are identified. The sub factors responsible for causing the problems will be identified on a continuous basis until the rot cause(s) are identified to form the basis for solving the problem; by eliminating the root cause. The resultant digram has branches and sub branches (looking like a fish bone structure) with causal factors that result in the problem (Cano, Moguerza & Corcoba 2015). The cause of product variation that leads to defective products at Latino Engineering are grouped into the categories of people, methods, material, machines, the environment, and measurements.
According to Hambleton (2008), the Pareto chart works on the concept of the 80/20 rule that posits that in any given process, 80% of the problems or failures are caused by just 20% of the main factors that are collectively referred to as the ‘vital few’. The remaining 20% of the issues and problems and failures are then caused by 80% of the several minor factors that collectively are referred to as the ‘trivial many’. For the Latino Engineering case, the vital few problems need to be identified to solve 80% of the main problems first, before the remaining 20% can be solved through a continuous process of improvement. The Pareto chart further helps to highlight the most important factors that are the main/ major reasons for the observed problems. The Pareto chart is made up of several bars (bar graphs) and lines that represent individual factors in descending order in terms of their impact and the line graph shows the cumulative total of the individual factors. The Pareto chart will help in distinguishing between the trivial many and the vital few so that effort and resources are focused on important problems. The chart also will help in graphically displaying the relative problem causes’ importance and will aid in focusing on the causes with the highest impacts when finally solved.
According to Howell (2015), this is a scatter plot and is a statistical tool that is used to establish the dependence between two variables or to derive the correlation between the two. The plots are made on a Cartesian plane with the X axis having one variable and the Y axis having the other variable. The relative values are plotted as dot on the Cartesian plane on their common points of intersection; when these dots are joined, the existing correlation / relationship between the two variables can be determined based on an equation in the form of y = m(x) + c (Howell 2015)
where c is a constant. With this relationship established, future predictions can be made on how a change in one of the variables will cause the other variable to respond. The Scatter diagram, therefore, will be useful in establishing the relationship between the overall effect and the causes of the effect and determine how significant this relationship is. The relationship between the two variables can be curvilinear, linear, logarithmic, exponential, polynomial quadratic, as well as being either positive or negative and weak or strong. If the correlation is stronger, then the relationship holds true equally strongly. The slope of the best line of fit determines whether the relationship is negative or positive.
This is also a statistical chart that will be helpful for determining whether the production and manufacturing processes at Latino Engineering are within determined controls and capable of meeting the specification and performance limits. The control chart will be used to establish if the process of production for a given product is stable as well as capable under present conditions. The control chart entails plotting data against time in the X axis; the chart will always be characterized by a central line (mean or average) an upper and lower control limit line; of which lines are drawn from historical data. Comparing the present data to these lines, conclusions will be drawn on whether the process variations are consistent where there is control and affected by common variation causes; or unpredictable meaning out of control and affected by special variation causes (Howell 2015). The chart and information from this chart will help in differentiating common causes from the special variation causes. The control chart is a very important tool for quality control and plays a very important role in the definition of the capability of processes and production variations. It is also helpful in identifying whether the process of manufacturing is in line with regard to the expectations of the customer and will be useful in helping solve the problem of defective engineering products.
Ensuring Continuous Improvement
The Kaizen model, a Japanese invention, is a term that signifies changing for the better; it a practice of continuous improvement that works on the following guiding principles;
Good processes create good results
To grasp the present situation, one needs to go see for themselves
use data for speaking and facts for managing
Action should be taken to contain as well as correct root causes of problems
people should work as a team
It is everybody’s business to continuously improve (Zink 2012)
using the 7QC tools, small changes will be made continuously over time, and based on the Kaizen principle, the results from these small changes will be massive. For instance, reducing the time for customer service by 25% at every repetition of an intervention will see massive improvements after just three repetitions of the process, using Kaizen.
Considering the problems that Latino Engineering is faced with just 12 months after new owners took over the company, it is essential that the POTI model is used to ensure improvement by analyzing the causes of issues first. The next step is to employ suitable tools, in this case using the 7 QC tools for generating data about important facts, the relationship between cause and effect, and the frequencies of these causes as well as the effects. These will then be used to make decisions on which causes to solve first for th biggest improvements. The tools will be used continuously based on the Kaizen approach where small changes/ improvements will be made incrementally and eventually result in massive and significant changes after being repeated a few times.
Cano, E. L., M. Moguerza, J., & Corcoba, M. (2015). Quality Control with R An ISO Standards Approach. Cham, Springer International Publishing.
Cassidy, A., & Guggenberger, K. (2001). A practical guide to information systems process improvement. Boca Raton, Fla [u.a.], St. Lucie Press.
Cruz-Cunha, M. M. (2010). Enterprise information systems for business integration in SMEs: technological, organizational, and social dimensions. Hershey, PA, Business Science Reference.
Djellal, F., & Gallouj, F. (2011). Measuring and improving productivity in services issues, strategies and challenges. Cheltenham (Royaume Uni), E. Elgar.
Feigenbaum, A. V. (1992). Total Quality Control. Hoboken, NJ, Wiley
Jain, P. L. (2001). Quality control and total quality management. New Delhi, Tata McGraw-Hill.
Hambleton, L. (2008). Treasure chest of six sigma growth methods, tools, and best practices: a desk reference book for innovation and growth. Upper Saddle River, NJ, Prentice Hall.
Howell, M. T. (2015). The Results Facilitator Expert, Manager, Mentor. Hoboken, CRC Press.
Kenton, L. V. (2005). Manufacturing output, productivity and employment implications. New York, Novinka/Nova Science Publ.
Land, S. K., Smith, D. B., & Walz, J. W. (2012). Practical Support for Lean Six Sigma Software Process Definition Using IEEE Software Engineering Standards. New York, NY, John Wiley & Sons. https://nbn-resolving.de/urn:nbn:de:101:1-201502241429.
Mohanty, R. P. (2008). Quality management practices. New Delhi, Excel Books.
Revelle, J. B., & Margetts, D. N. (2010). Home builder's guide to continuous improvement schedule, quality, customer satisfaction, cost, and safety. Boca Raton, CRC Press.
Shiba, S., Walden, D., Graham, A., & Petrolini, J. (2007). Four Practical Revolutions in Management: Systems for Creating Unique Organizational Capability. Florence, Productivity Press.
Tavana, M., Szabat, K. A., & Puranam, K. (2017). Organizational productivity and performance measurements using predictive modeling and analytics. Hershey, Pennsylvania, IGI Global
Zink, K. J. (2012). Total quality management as a holistic management concept: the european model for business. New York, Springer.