The requirements of quality management systems have evolved significantly over the past several years, writes Ian Huntly, CEO and MD of Rifle-Shot Performance Holdings.
Competing pressures to both ensure customer satisfaction and reduce the cost of quality are driving many manufacturers to question both the efficacy and approach of their current system. Extracts taken from an Aberdeen report provide actionable steps for manufacturers to transform their business and begin to create a closed-loop enterprise system that aligns the entire value chain with a single view of quality execution.
The impact quality can have on corporate performance is often and underestimated by manufacturing organisations. If we examine the design-make-deliver processes, there are a number of workflows where the incorporation of enterprise quality management processes would yield tangible benefits. This research is aimed at identifying how best-in-class manufacturers are effectively ensuring quality throughout these processes.
Best-in-class companies realise:
* 99% on-time and complete shipments;
* 89% OEE; and
* 2,5 hour response time to non-conforming shipments.
Enterprise quality management is an architectural approach to optimising quality business processes and is the standard among best-in-class manufacturers. In order for manufacturing enterprises to successfully reduce the cost of quality and incorporate closed-loop quality processes into established workflows, product and process traceability, non-conformances, corrective and preventive actions, engineering change orders, customer complaints, RMAs, FMEAs and audit documentation must all be managed in real-time across all levels and functional areas of the enterprise.
The top pressures driving manufacturers to focus on enterprise quality management initiatives are the need to ensure customer satisfaction and the need to reduce the cost of quality. Both of these pressures were at the top of the list in last year's study and both were selected by a majority of survey respondents this year, making it clear that these issues resonate in any economic climate.
Quality is a key determining factor of customer satisfaction and long term corporate viability, but it is no longer enough to just manufacture better quality products to gain a competitive edge in the market place, perceptions of the quality of the organisation are even more important. With increasing globalisation, distributed product development and multi-echelon supply networks manufacturers are now pressured to deliver products to market quicker, at a higher quality and at the lowest possible cost.
Aberdeen's analysis reveals that best-in-class manufacturers significantly differ in how they manage their operations across a broad range of business capabilities and technology enablers. Best-in-class manufacturers are more than two-times as likely as Laggard manufacturers to standardise processes to respond to adverse events.
In addition, they have clear procedures established in case of a nonconforming incident, which gives all the employees a clear understanding of the steps that need to be taken once an adverse event has occurred. This is one of the critical capabilities enabling best-in-class manufacturers to respond to non-conforming shipments in 2.5 hours as compared to 42 hours for Laggard manufacturers. Once these processes are standardised, all the stakeholders are aware of their responsibilities and are able to act intelligently and in a timely fashion.
One of the ways to enable standardisation of quality processes across the enterprise is to have a strong executive vision and then buy-in from stakeholders at different levels of the organisation. Best-in-class and industry average manufacturers are both more likely than Laggard organisations to have established continuous improvement teams focusing on improving quality processes. This is an important capability to enable the success of the second most prevalent strategic action: improving collaboration across the enterprise.
However, having continuous improvement teams alone does not differentiate best-in-class performance. Best-in-class manufacturers are enabling the success of continuous improvement teams by establishing executive priority to improve quality management processes across the enterprise. Again, best-in-class manufacturers are 28% and 80% more likely than industry average and laggards, respectively, to have executive sponsorship of their quality processes.
The key to success is to have active senior executive sponsorship as well as cross functional teams to review and streamline processes from and enterprise quality stand-point. Aligning the organisation in such a way is crucial because it allows manufacturers to control the quality of the product and processes not only within the four walls of the plant, but also extending across the value chain.
Knowledge management capabilities highlight the ability of best-in-class manufacturers to have real-time access to quality data and utilise this knowledge to enable decision making. The best-in-class have invested resources in establishing both predictive and responsive capabilities to manage the quality of the products across the enterprise.
On the performance management side, best-in-class manufacturers are more likely to have established an executive level score card for performance benchmarking across the organisation. In conjunction with score-carding, the best-in-class are also more likely to have created the analytics that allow for quality metrics to be translated into corporate performance. This means that many Best-in-Class companies understand how scrap rates impact the cost of goods sold, or how supplier quality performance impact complete and on time shipments.
Your enterprise quality management system (EQM) should be the basis for the way you deliver your products and services, irrespective of the size of your organisation. A good EQM is merely good business sense. Ensure you partner with the right supplier who can deliver this for you right now.