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Continuous Improvement

SET Management Program
by

Nic Stephen

on 19 November 2014

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Transcript of Continuous Improvement

Improvement
The 6 Pillars of Quality

Inspection routines – what’s in place?
Service requirements – DEWR / TQA
Star ratings
RTO registration audits
Usually imposed from key stakeholders including:
Board, Govt, Grant,
Bank/Insurer, HACCAP, WHS
Category 1
?
Production times
Turn around time
Budgets
Customer interactions
Stakeholder performance
System performance
Process performance
Employee results
Organisational culture

About anything!
Productivity
Accidents / incidents
Errors
Complaints
Waste
Rework
Outputs
Variations
Sales
Supply costs
Staff wages
What do all of these measure?
Standardise work
Organisation
Visual controls
Plant layout
Quality of product
Batch reduction
Quick changeover
24 shift – 2 to 3 cycles
Reduced task time
Improved OHS

Used in a Manufacturing environment
Analyse the flow of info/material
Aims to enhance value by continually making improvements
Eliminate waste, non-value activities
Adjusting production flow based on customer demand – D.I.F.O.T.
Category 4

TQM is a collection of principles, techniques, processes, and best practices that over time have been proven effective
Category 3

Quality Control
Quality Assurance
Total Quality Management (TQM)
Lean Manufacturing
Balanced scorecard
Cause and effect charting
SWOT Analysis
Flow charts / Pareto charts
Force field analysis, etc
Tools & Categories
Reducing risks
Waste minimisation
Cost reduction
And Improved service

A CI process can improve performance through:
Continuous Improvement is an approach to productivity improvement.

A daily activity

Uses TQM tools and techniques

Needs the team engaged to ensure success
CI... What is it?
When deciding whether or not to do something, Consider the value?

Are you wasting your resources on a low yield task?

Which tasks are worth spending more time on?
Implications for you?
A) $100,000 +
B) $33,000 /
C) 200
Costing your Time
What profit are you required to make?
Average = 33% (of $100k) = $33,000

C) What is your profitable time?
Working days = 200 productive / yr
7.5 hours day = 1500 hour / yr
Costing your Time
Salary, payroll tax, super, office space you occupy, power, phone, rent ($70k)
Equipment & facilities you use – chair, computer, desk, software, etc ($5k)
Other expenses – vehicle, uniform, business cards, admin support, HR support, % of HR costs! ($25k)
Costing your Time
Assuring the client gets what is expected
(Fit for purpose / up to standard)
In line with agreed standards
Provide documented evidence controls are in place
WHS, visit schedule, manual handling
Australian Standards (codes of practice)
Usually involves a manual
Using 1 or more of the tools discussed;
Brainstorm the measurement you could implement to solve a problem in your area

Cause & Effect
Force field
Process Map
SWOT
Action Planning
Flow Chart
Some CI Tools
Your role is to integrate the techniques of Continuous Improvement into the way you conduct business by producing a working environment that:

Encourages staff to look for ways to make improvements
Provides opportunities for staff to make suggestions on how improvements can be achieved
Listens and takes seriously staff suggestions on improvements
Implements approved suggestions for improvements
Evaluates the effectiveness of the improvements
Your Role in CI
Productivity is simply a ratio measure of how much an organisation makes divided by how much it costs to make the goods or services it produces

The greater the cost (input) for the same or less of goods and services (output), the lower the productivity

The lower the cost (input) for the same or more of goods and services (output), the greater the productivity
Flowcharts can be used to describe an existing process or to present a proposed change in the flow of a process

Flowcharts are the easiest way to "picture" a process, especially if it is very complex. Flowcharts should include every activity in the process

A flowchart should be the first step in identifying problems and targeting areas for improvement.
Flowcharts

Meeting the needs of their customers by improving the quality of the products or services provided

Responding to their customer’s needs quickly

Minimising waste and unproductive time where possible
Striving for CI


This resource is copyrighted to State Enterprise Training

Except as permitted by the Copyright Act 1968 (Cth) or unless you have obtained specific written permission of State Enterprise Training, you must not:

·Reproduce or photocopy this resource in whole or in part
·Publish this product in whole or in part
·Cause this product in whole or in part to be transmitted
·Store this product in whole or in part in a retrieval system including a computer
·Record this product in whole or in part either electronically or mechanically
·Resell this product in whole or in part

Identify opportunities for continuous Improvement
Implement a systematic approach to continuous improvement systems and processes
Identified how to measure the productivity in the workplace
Effectively use Total Quality Management tools for problem identification and solving
Monitor and adjust performance

Summary
Tools for the Planning Stage
The (PDCA) Continuous Improvement Circle
Structuring Quality into a system of Continuous Improvement that permeates through the core values of the organisation

Continuous Improvement is integrated into the way we do business here

Continuous Improvement is driven through a structured systematic manner that promotes efficiency and is effective
Commitment to CI
Efficiency - The ratio of a specific measure of output to a specific measure of input

Effectiveness – The effects of a job, task, or project on the bottom-line profits, the local economy, society, or the environment

Cost containment or reduction of expenses

Employee benefits, goodwill, and morale

Growth of the work unit’s power base, and/or budget

Ability to coordinate between work units

Stability and/or equilibrium – minimisation of worker and managerial absenteeism, stress, conflict and turnover
Productivity is…
Pareto
Process Flowchart Diagram (pg. 13)
Cause-and-Effect Diagram (Pg. 11)
Run Charts (pg. 12)
Control Charts (pg. 12)
Check Sheets
Statistical Analysis Tools
Set the benchmark of performance required when completing a task
Deliver consistency through standardised steps
Articulate the sequence of steps required
State any materials required to complete the task
Articulate any safety considerations
SOPs
Defining work as a process, with inputs from suppliers and outputs to customers
Describing how a process really works
Tracking and analysing the performance of a process
Redesigning a process to improve its performance
Process Management
Total Quality management (TQM) is defined as both a philosophy and a set of guiding principles that represent the foundation of a continuously improving organisation

TQM is the application of methods to improve all the processes within an organisation to exceed customer needs
Quality Management
Today’s Objectives
We should be able to:

Identify opportunities for continuous Improvement
Implement a systematic approach to continuous improvement
Identify tools and techniques for measuring productivity
Identify and use appropriate tools for problem identification and solving
Identify and apply strategies for monitoring and adjusting performance
Striving for Continuous Improvement
Tools for the Checking Stage
Tools for the Doing Stage
In pairs, list what you can do to engage your teams to participate in continuous improvement
Activity 4
The Customer/Supplier model
Process Control and Capability
Problem Solving
The cost of Quality
Teamwork and Involvement
Communication

Why is it important?
What is Quality?
The pursuit of quality should be a never ending quest for continuous improvement
Evacuation Procedure
Conveniences
Attendance Sheet
Reading Material
Agenda
Morning Tea 10.30am
Lunch at 12.30pm
Afternoon Break 2.30pm
Finish by 4pm
Deciding what to do with the product of the quality experiment
Change more variables?
Standardise the new process?
Act
Select problem or process
Describe the process flow
Describe various causes / ID the root cause
Develop a solution
In pairs, complete productivity 1 activity

then......

Individually, complete productivity 2 activity
Activity Four
Productivity
To figure out the cost of Quality you need to analyse several different elements.

If you wait and inspect things once they are done and then try to fix the problem you will incur a number of expenses; you are building defective items that cannot be used.

Fixing products or services out at the market place, incur warranty costs, as well as destroy customer loyalty and goodwill.
The customer/supplier model
Process Control and Capability
Problem Solving

The cost of Quality

Teamwork and Involvement
Communication
Six Pillars of Quality
The need to collect factual data and to use this data in identifying problems and identifying solutions that are an improvement to Quality
The customer/supplier model
Process Control and Capability

Problem Solving

The cost of Quality
Teamwork and Involvement
Communication
Six Pillars of Quality
In groups, complete the flowchart activity
------ or ------
Write up a Standard Operating Procedure (SOP)
Activity Two
Individually identify the supply chain for your business

Then select one point of the chain and identify the standards of performance required at that point to deliver a quality outcome
Activity One
Six Pillars
The customer/supplier model

Process Control and Capability
Problem Solving
The cost of Quality
Teamwork and Involvement
Communication
Based on the work of W. Edward Deming, this concept views quality as being created all along the customer/supply chain. Previous to Deming’s philosophies, quality was only something that was created at the final output point
In groups, complete TQM tools activity

Devise a strategy for managing continuous improvement in the scenario
Consider Deming’s quality circle
Consider the 6 pillars
Activity Six
May sometimes be called study
Review and gather data to check that the implementation has created quality improvement
Check
Put the plans into action
New plans are generally implemented on a limited scale
This allows for evaluation prior to full implementation
Do
Six Pillars of Quality
The customer/supplier model
Process Control and Capability
Problem Solving
The cost of Quality
Teamwork and Involvement

Communication
We are a social race, we interact by form of communication. Verbal, non-verbal behaviour.

Communicating assertively, clearly and concisely. Questioning and listening skills.

All these are vital if teamwork and quality are to flourish.
Six Pillars of Quality
This concept is the belief that Quality requires a paradigm shift from the notion of Quality being a engineering accountability, to the notion that quality is the involvement of everybody involved in the supply chain.

Employees do want to work smarter and are interested and have pride in their organisation.

It’s management’s responsibility to ensure that an environment is created where employees can flourish
The customer/supplier model
Process Control and Capability
Problem Solving
The cost of Quality

Teamwork and Involvement

Communication
In groups, complete the Pareto and Fishbone activity
Activity Three
This concept focuses on the need to look at the different steps in the process to ensure a deliverance of Quality.

This requires the use of Quantitative tools like statistical process control
The customer/supplier model

Process Control and Capability

Problem Solving
The cost of Quality
Teamwork and Involvement
Communication
Six Pillars
No
Yes
Are results positive?
Act based on results
Track results and measure against targets
Implement improvement activities for a limited period
Identify improvements
Collect and analyse data
Map the process and identify causes and variables
Define the boundaries of the process
Identify process and define process objectives
Implementing CI
B
A
Receive payment
Mail out invoice
Sell goods/services
Enter client details
into a database
Capture client details
Call on client
Sell goods/services
Send out marketing
material
Develop marketing
material
Enter client details
into a database
Capture client details
Call on client
Copyright Warning
An organisation should be striving for CI in these three areas of business:
More on this later!
"Quality at every point"
1
Are you spending your time profitably?
Q: What do you cost?
Let’s say $100,000/year
Equation = A + B / C = What your worth!
= $665 day or $88 hr
$$$$$$$$$$$$$$$$$$$$$$
What is used in adopting a CI?
Quality Control
Category 2
Quality Assurance
TQM
Lean Manufacturing
Could be improved?
What sort of things
2
Total
Quality
Management
Process Management refers to:
Processes are commonly illustrated through SOPs or flowcharts
Plan
In today’s workshop we developed the skills to:
Activity = Implement the solution

Typical Tools
Flow charts / Action plans
Activity = Evaluation
Tools = Check sheets, surveys, etc
The Shape of Things to come
Fast Thinking Magazine, Issue 2 2012
As Canadian cyberpunk author William Gibson said nearly 20 years ago,
"The future is already here - it's just not very evenly distributed".
"Seeing a problem & imagining a solution before the market asks for it provides as opportunity for innovation"
Alec Lynch, Founder, DesignCrowd
eBay Australia
"9% of retails sales is now online, but a further 37% of purchases are informed by online research. For more and more consumers the internet in now their source of truth"
The Future of Computers
The personal computer is one of the defining inventions of the 20th Century.
Teamwork
Brainstorming, Affinity charting, SOP's, Flowcharts
Tools for Acting stage
Continuous
Budget
Financial
Products
& Services
HR
Performance
Management
Pricing
Practical value
WHS
Risk Management
Planning
Workspace
Layout
Efficiency
Professionalism
Communications
Internal
External
Effectiveness
Customer
Client Analysis
Industry
Competition ....
What to
Mission | Vision
Stakeholders
Values
Network
Alliances?
focus on?
Goal
Setting
Decision
Making
Risk
Analysis
Tools
External
Forces
People
Management
Brand
Image
Systems
Research
Data
Your Business
Marketing
Promotions
Competitor
Analysis
Procedures
Training
Systems
Triggers
Lasting
Margin
Operational
Continuous
Improvement
Innovation
Growth
Management
Documentation
Policies
Procedures
Operational
Analysis
Admin
Efficiency
Productivity
Production
Logistics
Capacity
Technology
Cost Benefit Analysis
Software
Skills
Brand
Image
Pricing
Practical value
Triggers
Lasting
Margin
Plans
Action
Strategy
Vision
Priorities
Implement
Schedule
Measure
Test
&
Goal
Setting
S|K|E
Investments
Context?
map
Emotions
or Problem
Needs
Tangible
Obvious
Powerful driver
effects decision
most important
Values
Expect
Expectations
Required Questioning
Several.....
Value adds
Demographics
Historical
Who are our repeat customers?
Who has gone elsewhere?
Why??
Brand
perception
How are you seen in the community?
Where are they from?
How much do they spend?
How are they educated?
Operational variable
Age | Gender
What do they value?
Value Proposition
Points of difference
USP
Quality
Price
Options?
Reliability
Responsiveness
Flexibility
Knowledge
Services
Product
Hard to judge
Triggers
Questioning
Listening
Understanding
Genuine
Solve
Customer
Analysis 101
Regular reminders
Brand
Promotions
Stories
Sharing occurs with stories
What stories do you have?
Ideas top of mind spread
Mars bar = Mars planet
Practical = easy to share
People love to tell!
Value
Trust...
Frustration
Confusion
Pride
Ever wondered what the
most important
aspect of your business was?
Part of Forte's
Our service is broken into
Want a sneak peak?
Key Steps
How?
It's a muddy pond
Organisation X
The Emotional Cycle of Change
Stage 1: Uninformed optimism.
Stage 2: Informed pessimism.
Stage 3: Hopeful realism.
Stage 4: Informed optimism.
Stage 5: Completion.
[2012 stats]
Full transcript