Quality and Supply Chain Management

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Quality Initiatives

The Juran Trilogy

Juran’s approach to quality management outlines the three main processes that a company should consider. The first involves quality planning, a step that lays a foundation for future decisions and changes (Pop & Țîțu, 2016). During the planning stage, a business must examine its customer base and develop strategies that would be in line with the company’s mission and goals while at the same time appealing to the main stakeholders. It is important to investigate clients’ needs while defining the main features and purposes of products. After all the processes necessary to meet customers’ needs have been identified, the organization should engage in quality control. This activity implies that the company will adhere to the specifications of production methods. Here, it is necessary to determine ways to measure and monitor work performance. Data collection is also essential because the information gathered can later serve to distinguish defects and ineffective procedures. Finally, quality improvement is included as the last stage of the trilogy. During this step, all inefficient practices are examined and altered to improve overall performance.

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The main benefit of this strategy lies in its broad applicability. The Juran Trilogy can be implemented in any type of business. This approach’s focus on change and customer needs also creates a flexible system for designing plans. However, one drawback to this method is that it may not be suitable for companies needing to cater to a diverse group of clients. If a business has buyers possessing a variety of different needs and tastes, planning can become complicated.

Crosby’s Program

In an effort to reframe the concept of quality, Crosby developed four absolutes for its definition. According to this approach, an organization shows its best performance when it follows the Zero Defects policy, which states that mistakes should not be considered a part of quality management (Ngambi & Nkemkiafu, 2015). Therefore, businesses must aim to prevent errors from happening in the first place by focusing on actual rather than statistical measurements of quality. To achieve high compliance with this program, a company will have to reeducate workers about their responsibilities. Employees will accordingly need to believe that their performance directly influences the company’s products, and any mistakes will hinder both the products’ success and client satisfaction. Thus, an interest in their duties should have the effect of encouraging employees to improve performance while creating an atmosphere where mistakes are regarded as an unacceptable part of operations.

The ideological platform of this quality management strategy appears to be positive for both businesses and customers. The approach places responsibility on workers and focuses neither on redesigning nor remaking processes but on conditioning employees to actively engage in their work. Nevertheless, the steps required to successfully implement this program make it expensive. In addition, employee recruitment, training, and motivation must be completed early as the approach does not seek out improvement opportunities in the later stages of the business’s existence.

Deming’s Program

Deming expressed his ideas on the topic of quality management in the form of fourteen steps, laying out concrete suggestions for business improvement designed to increase performance and reduce costs. These include creating a specific purpose for development, implementing a new philosophy, maintaining independence from inspections as only determinants of quality, and collaborating with one supplier to reduce costs (Ngambi & Nkemkiafu, 2015). Other advice focuses on continuous improvement, employee training, and strong leadership. Deming also opposed writing slogans and creating workplace barriers for employees, along with numerical quotas and goals, annual ratings, and merit systems (Ngambi & Nkemkiafu, 2015). Lastly, he valued education and stated that self-improvement programs should be established to involve all workers in improvement initiatives. By following these steps, employees and management can influence their performance.

This approach provides information about activities using detailed descriptions, thus simplifying implementation. While promoting innovation and reducing costs, its focus on internal processes may reduce managers’ attention to external factors. The program also suffers an inherent lack of flexibility as it involves strictly defined directions. Nonetheless, the benefits of education and continuous training are underlined for a reason: These initiatives may be more efficient in terms of retention and loyalty.

TQM

The main concept of TQM (total quality management) is that a company can reach long-term success by focusing on customer satisfaction. Therefore, all the processes and activities of an organization must revolve around the idea that services, products, and professional interactions should be improved and changed to fulfill the needs of clients (Androniceanu, 2017). This approach follows a number of customer-focused principles. People who consume goods and services have the capability to determine the quality of the products. Thus, each action of the business should be measured and its value established according to changes in the clients’ level of satisfaction. Furthermore, effective TQM engages all employees in improvement initiatives. Workers can commit to their duties if they are comfortable in the provided environment and management empowers them. The organization must be process-centered, where all parts and steps of operations are defined and monitored to ensure quality and avoid mistakes. Strategic planning is also essential to this method, along with evidence-based decisions for change and continuous improvement.

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TQM addresses various spheres of business structure, thus providing managers with many helpful suggestions. The approach values the contribution of every employee and empowers each worker to participate, share ideas, and collaborate with others. These aspects raise employee morale and improve the company’s reputation. Nevertheless, it should be noted that TQM incurs high initial costs and takes a long time to implement. Thus, some improvements may not be seen instantly, and this can cause employees to resist change.

Six Sigma

Six Sigma seeks to change the quality of a company’s performance by reducing the probability of errors and defects. In this data-driven approach, all practices are measured and evaluated in order to reduce variability and increase the stability of all outputs (Conger, 2015). All calculations for this method are grounded in statistics that define quality levels as based on the proportion of defects. According to this improvement initiative, companies should aim to achieve an accuracy score of 99.9997% (Conger, 2015, p. 129). In business, Six Sigma helps the managers of a company to evaluate all operations and locate ineffective or unnecessary steps with an aim toward improving upon or eliminating them. Such techniques as cause-and-effect diagrams or root cause analyses assist the organization’s specialists. In this approach, DMAIC (“define, measure, analyze, improve, control”) and DMADV (“define, measure, analyze, design, verify”) serve as the primary methodologies (Conger, 2015, p. 129). These frameworks organize the process of evaluation and improvement by establishing specific steps.

Similar to the other approaches discussed above, Six Sigma is customer-driven. Its benefits lie in the goal to reduce variation and the rate of defects, improving quality through transparent calculations. However, such analyses require highly skilled professionals and significant time and effort to collect and assess data. For large corporations, this program may be simultaneously effective and challenging. Also, the Six Sigma focus on data rather than an actual product may affect a company’s primary duty: delivering products and services to clients.

Opportunities for Improvement

Supply Chain Management

Lack of communication and data sharing with vendors needs to be addressed in this case. The company should create a system for cooperative participation, where all business partners in the supply chain are automatically notified of changes in production. In order to develop the system, all vendors should be contacted to choose the best approach. It is important to note that current developments in technology and the Internet can facilitate implementing a service that is simple, intuitive, and open to a large number of users. The use of a digital platform for all informational messages can help the company reach out to its partners quickly (Marinagi, Trivellas, & Reklitis, 2015). The company should appoint a person involved in vendor communication to design an appropriate notification service.

Demand Planning

The periods between updates reflecting customers’ demands are too long to allow the company to be flexible in dealing with its supplies and production. To reduce the rate of mistakes, the organization can implement quick response logistics. These processes are based on Internet-enabled data sharing. For example, production schedules can be linked to the requirements for replenishment through the use of computerized systems (Christopher, 2016). By using a quick response system, the business will need less inventory and safety stock, diminishing forecasting errors. Investment in an information system may appear to be a significant expense, but the resulting long-term profitability will be visible after some time (Christopher, 2016). While the current system allows only monthly reports, it is noteworthy that various corporations update such data daily (Christopher, 2016). The idea can be adopted in all parts of the chain, further decreasing the possibility of critical miscalculations.

Multistage Inventory

The use of MRP (materials requirements planning) is usually considered helpful for businesses. These programs allow all supply chain elements to record time and requirements, providing a basis for all operations (Christopher, 2016). However, if the company faces a problem involving continuous updating, it may be more helpful to look for software and hardware that can successfully complete all operations without overwhelming the system. Another approach would be to introduce DDMRP (demand-driven MRP) into the chain. This is a planning practice that facilitates inventory analysis and proposes options for production according to current demand indicators. DDMRP’s flexibility and dynamic planning may require fewer information inputs than MRP. These systems do not demand a similar level of responsiveness from their users and can help the company to decrease pressure related to an abundance of updates.

Transportation Planning

Including a specific carrying company in the supply management chain may prove to be beneficial for the business. If ABC chooses to employ a carrier to deliver its goods to customers as well as bring in the parts needed for assembly from its vendors, the costs and the rate of mistakes may decrease significantly (Christopher, 2016). The advantages of contract carriage include added customization of orders and conditions, which is not possible with common delivery services. Moreover, this practice reduces the dependency on local organizations and their individual regulations. The company’s existing private carriage needs to be reassessed to determine whether it is sufficient to meet the company’s demands. If ABC has the ability to choose to use only one service for all deliveries, the company may gain more opportunities to reduce expenditures for vehicle maintenance and related needs.

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Process Control, Performance, and Variability

The company’s inconsistent reporting can be examined using various Six Sigma practices. For example, a root cause analysis of this issue may uncover why critical information reaches management so slowly (Conger, 2015). Another possible suggestion is to automate notifications as discussed above. Its abilities can assist in this situation as well. The reports are most likely inconsistent because of the lack of an established system for their formation and sharing. Therefore, creating a platform that will regularly update managers about shortages and scrap will result in a reduction in the number of errors. Six Sigma methods and digital solutions are the most effective ways of solving such problems.

Negative and Positive Cash Flow

Cash flow swings may not only be challenging to manage, but they can also make the business unstable. In order to provide stability, a number of initiatives can be proposed to the CFO. First, it is possible that the current forecasting of inflows and outflows is not sufficiently detailed to prevent significant differences in these processes. The CFO should reassess the existing data recording template and make improvements as necessary. Furthermore, the company can try to renegotiate terms with its suppliers to review a longer payment window or other aspects of the agreement. This may help to balance the outflows. Furthermore, inventory size should be decreased to satisfy client demand without additional expense. Investments in better information sharing systems and other technology could be a valuable long-term solution as well.

References

Androniceanu, A. (2017). The three-dimensional approach of total quality management, an essential strategic option for business excellence. Amfiteatru Economic, 19(44), 61-78.

Christopher, M. (2016). Logistics & supply chain management (5th ed.). London, UK: Pearson UK.

Conger, S. (2015). Six sigma and business process management. In J. vom Brocke & M.Roseman (Eds.), Handbook on business process management 1 (2nd ed.) (pp. 127-146). Berlin, Germany: Springer.

Marinagi, C., Trivellas, P., & Reklitis, P. (2015). Information quality and supply chain performance: The mediating role of information sharing. Procedia-Social and Behavioral Sciences, 175, 473-479.

Ngambi, M. T., & Nkemkiafu, A. G. (2015). The impact of total quality management on firm’s organizational performance. American Journal of Management, 15(4), 69-85.

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Pop, A. B., & Țîțu, M. A. (2016). Study regarding the quality assurance in manufacturing processes. Management of Sustainable Development, 8(2), 11-15.

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