Monday, June 3, 2013
THE DIFFERENCE MAY BE IN LOSS CONTROL MANAGEMENT
AS I HAVE QUOTED AT VARIOUS TIMES "QUALITY WAS DEVELOPED FOR PRODUCT INTEGRITY - WHILE LOSS CONTROL WAS DEVELOPED FOR ALL LOSS PREVENTION AND LOSS COST REDUCTION INCLUDING PRODUCT QUALITY ASSURANCE."
I have read recently that some Quality Associations are advising against training in Six Sigma, are not supporting the use of Six Sigma as an improvement methodology and are saying in their opinion, straight Six Sigma training programs today suffer from too many of the errors and are excessively complex. (That may not be the underlying cause of the program or system failure.
Their view is, Six Sigma was a Continuous Improvement CI program developed by engineer Bill Smith of Motorola in the 1980′s. He took the Quality and CI approaches of the day Deming and Crosby and adapted them for the particular conditions and circumstances in which Motorola found itself. Bill Smith’s original intention in creating Six Sigma was to simplify existing CI approaches. This will strike anyone familiar with what is now called Six Sigma, with all its structured complexity, as more than a little ironic.
As conceived by Bill Smith, Six Sigma did not have various belts nor a preoccupation with cost reduction as it does today. These were later additions provided by Mikel Harry, a Motorola Vice -President responsible for deploying Six Sigma across Motorola, and who later founded the Six Sigma Academy — a consulting practice dedicated to promoting Six Sigma. The almost singular focus on cost savings promoted by Six Sigma practitioners today, is nothing less than a perversion of Bill Smith’s original conception of Six Sigma.
The point here, is that what was supposed to be a simplified approach to CI, has evolved into a technically complex and confusing monster designed as much for generating consulting fees as anything else. Worse, this evolution has seen fundamental errors in statistical method arise in the Six Sigma programs as promoted by a number of vendors. This is an intolerable situation for a methodology supposedly built on a foundation of sound statistical practice. Unfortunately, most organizations using Six Sigma are finding themselves engaging in statistical nonsense that masquerades as science or sound CI. Personally, I believe it may be a lack of leadership, improper emphasis, and lack of continued commitment.
I would agree with this logic. When managing a (PC&S) Property Conservation, Safety, Health, Security and Environmental Department at a major Division for Grand Metropolitan, LLP. Organizational Loss Control Management was the base for managing loss in utilization of the Int'l Safety Rating System (ISRS) auditing methodology and 22 system elements and sub-elements. Management realized that loss and loss cost management required a balanced approach in protecting the human asset and the physical assets , which were equally important. That is why they chose to use ISRS Organizational Loss Control Management Auditing System on a quarterly basis internally, along with the use of (QFIT© DJBrignolaTeams as I call them today), then called Quality Circles, of the Crosby Quality Era. Later, ©loss control quality improvement teams ©LCQIT looked at process control using SPC and other real time production Statistical Process Control Methodology, by brain storming, monitoring charts within each operating department on each shift, reporting on Operating Loss Control Incidents: (Physical Asset Loss) Reporting Downtime, Process, Equipment, Structure Damage, Materials and Product Damage and Spoilage, Customer Complaints, etc., as well as Injury Accidents that may have occurred with these incidents. Several Capital Projects were thought out by the teams, incubated, and presented to plant and executive management. Short term items were completed immediately, while larger improvement projects having a three year payback were worked on and made part of the capital budget. Also, as with every capital engineering and maintenance project over $5,000, they all had to be reviewed by supporting specialists, engineering, operations, maintenance, safety, health, environmental and quality professionals, as mandated by the CEO and by the PC& S Department, and quarterly, the ISRS Engineering Controls Element Coordinator was required to audit all project engineering and maintenance records to verify that each project was reviewed for hazards and exposures, as they related to; Product Quality, Fire Protection Suppression and Engineering, Boiler Machinery and Energy Impact, Engineering (to FM Standards),Employee Health and Safety and Ergonomics and Industrial Hygiene exposures, as related to occupations, tasks and critical tasks during and after the project as the project was completed and on line.
Incidents /Accidents reports were sent to the Property Conservation and Safety Manager (PCS Mgr.) who also was the Coordinator of the Quality Improvement Teams, as a requirement by the VP of Operations, and General Manager of all Plant Managers. Those reports and charts were analyzed for trends, and findings were reported at weekly staff meetings, unless a significant change was identified, where as the General Manager was notified immediately. The GM would then contact the appropriate staff individual for controlled managed resolution, prevention of recurrence, and a scheduled follow up to be reported to the GM within the next business day or staff meeting whichever came first.
It has been written that in 2005 a company having had one of the largest fire and explosion losses of human and physical assets to date in the US... after their many evaluations, selected the Six Sigma program to assist in their re-organizational management effort. However, what they and the many experts and professionals may have failed to realize with that selection, is that profit improvement without built in professional, top down leadership supported Loss Control Management at it's core, is flawed, especially with systems using lean, as the jargon of choice. That same company a few years later had another incident, which was called the largest human, physical, and environmental disaster of modern times in the US. That loss to date is approaching $40 Billion. Thus, if they are a 10% profit margin company they will need to boost their gross sales and profitability substantially to make up for the net raw bottom line loss. You get the picture. I would think by now they have. As the saying goes "The Devil is in the Detail."
The ISRS like Six Sigma, and others are great systems... However, without continuous unbiased leadership, required ongoing management, employee training from the top down, the ongoing budgeting, personnel support, and without scheduled periodic unbiased auditing of each element of the system or process, with feedback to employees at all levels... This must be ingrained without interruption, regardless of management changes from the CEO on down throughout the ranks of management, union or nonunion... If not! The system is destined to fail.
I have learned through many years of unbiased auditing of the ISRS in working with Unions and Nonunion environments that it not about the profit, efficiency, quality, standards, it's about the people who work with your product or service regardless if you're a government, a for profit or nonprofit. If they who work for you fully understand your real objectives and goals or your business, product, or service your people will reward your enterprise with excellence in good and bad economic times.