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Abstract of Master's Work



Modern management technologies for improvement of production quality

Leader of work:PhD, the associate professor Momot Alexandr I.



Content


               Introduction
              1. Benchmarking
              2. SWOT-analysis
              3. Re-engineering
              4. System of Total Production Management (TPM)
              5. System “Sequencing” (5S)
              6. Blitz-kaidzen
              7. Six sigmas
              8. Balanced Scorecard (BSC)
              9. Self estimation
               Inference
               List of references





INTRODUCTION


Only the perfected management provides necessary changes

Edward W. Deming

       Relevance of researches. Relevance of researches. For achievement of strategically aims of every enterprise or organization are applicable different methods and approaches: management system standards, models of business perfection, benchmarking, re-engineering, six sigma’s approach, balanced scorecard etc. Nowadays we are more often faced with the next terms as quality, reliability, competitiveness and safety of production, we are speaking about certification of production, and we require the keeping consumers protection rights law. Given shows us the changing of our estimation of quality of production and services, not only by consumers but also by manufacturers. It is clear for us that under the market system there were no any investments will be helpful to enterprise if it would not be able to provide competitiveness of own production and services. Base of competitiveness is quality. Though additionally to quality the competitiveness includes price, terms of delivery, warranties, service maintenance and other factors, only the quality is preferable factor for buyers and clients when they choosing the production. For quality providing is necessary not only appropriate stock and qualified personnel but also correct quality management. By this statement is explaining high level of interest to quality management by enterprises, that have understood the next statement: it is impossible to count on stable providing of quality of production without integrating this system (quality system), which is corresponds to modern level of works organizing in this sphere. Every top management of enterprise or organization have faced with the problem of creating of effective system of management, aligned to strategically aims approaching. With this purposes it is possible to apply different approaches and methodic of improvement: management system standards, business improvement models, benchmarking, re-engineering, six sigma’s approach, balanced coefficients system etc.

       Aims and purposes of given work. Aim of given work is review and analysis of modern management technologies for quality of products and services improvement. Application of technologies, developed in market economy conditions in the most prosperous world enterprises and organizations could be helpful to Ukrainian economy to achieve perfect results in the field of wealth of society and also in adjacent sectors.

        Scientific value of given work is analytical review of present most prosperous and perspective management concepts in field of quality of products and services improvement.


BENCHMARKING




        According to data of consulting company Bain & Co, last two years benchmarking is in top three of most widespread methods of business management in Trans National Corporations (TNC). Benchmarking is method that was developed for large-scale business for improvement of its competitiveness. It includes studying and application of management methods of good acting organisations by means of comparison with own organisation (after determining of weak sides). Benchmarking consists not only from competitors analysis. It’s rather approach to brace the circle of customary visions. Studying of experience of competitors helps to avoid failures, minimize time and make short-term aims, at that on the basis of facts and reliable information.
       Prima facie benchmarking and industrial espionage it is the same things. But there is fundamental difference between this two methods. Benchmarking is the method of study of outsider experience that is not the matter of secret.
       Founders of benchmarking were Japanese who started to copy ideally outside achievements. They thoroughly explored European and American goods and services to discover its weak and strong sides and then manufactured something similar but more cheaper. Japanese successfully shifted technologies and know-how form one branch of business to another.
       In western countries benchmarking started to use in the end of 1970th. In this time Japanese enterprises actively started to press American companies and company Xerox have started to investigate the reasons of such sudden lost of market share of copying appliances. So, Xerox detailed studied experience of Japanese company Fuji. Top managers of Xerox even decided to move to Japan for a while to study not only technical achievements but also innovations in sphere of management, improved by different companies including from other spheres of business. Using of this experience allow to Xerox to raised down expenses, increased productivity etc. From that time benchmarking is the part of business strategy of Xerox.
       In Japan, USA and other country programs of benchmarking are developing under the government support. They’re acting so-called “industrial contact offices” (phrase of Phillip Kotler), that especially spring up for search of benchmarking partners (globalbenchmarking.com, benchnet.com etc). It is considered that due to such exchange of experience wins country economy as whole.
       Benefit for company that learns on best examples is evident. But what is the sense for top companies to disclose internal information? Reasons could be different. Many companies, for example, consider quite prestigious to be reviewed as standard. Moreover it increase their investment seductiveness and helps to lobby their interests on different levels. Japanese, for example, assured that if company teach somebody then developing itself.


SWOT-ANALYSIS




        SWOT-analysis is stage of strategically planning purpose of which is key factors, influenced on company activity. With carrying out of this analyse is stating the value of internal factors: lack and strong sides of organization, i.e. its specification, and external factors: opportunities of company and threats, i.e. characteristic of market environment. It could be applicable for determining important directions of strategically planning, evaluation of activity of board of managers, possible cooperation, seductiveness of product or service on market etc. Pragmatical advisability of SWOT-analysis is attempt of structural improvement of resultativeness of enterprise activity. On the basis of main points of SWOT-analysis the management of enterprise supposed to formulate guidelines in main directions of activity improvement. Only then it could be considered as finished.


RE-ENGINEERING




       Re-engineering of business-processes is the approach to management, which helps to make a “break-through”, gives awesome increasing of productivity and efficiency of enterprise activity in contrast to permanent step-by-step improvement. Its main point is achievement of next fundamental positions:
&1) Re-arrangement of business-procedures should be carried out without taking into account of preceding experience, so called “from blank sheet”;
&2) BPR suggest nether step-by-step improvement of business-procedures but its principal overpatching;
&3) BPR is sceptical to common principles;
&4) BPR requires sensitisation of constructive approach:
&5) Active using of high technologies;
&6) In the contrast with approach, connected with permanent improvements, performquadrature by individual executors, BPR could be implemented only top-down by specially created teams.
       For implementing BPR-project creating special team, which consists of: project leader, owner of process, managing committee, and re-engineering team.


TOTAL PRODUCTION MANAGEMENT SYSTEM (TPM)




       System of TPM is the system of total technical maintenance of equipment that was appeared in the result of concept of TQM development in Japan in 60-70th y.y. Purpose of given approach, directed on teamwork in systematical involving of whole personnel in permanent enhancement of service, maintenance and repair of equipment. Due to this it is possible to organize awesome influence on cost of production and serviced. It’s directed to achievement of next aims:
1) creation of corporate culture, assisting to increasing of efficiency of manufacturing;
2) organizing of loss prevention system within life cycle of equipment with purpose of achievement of “zero number of accidents”, “zero number of discard” and “zero number of failures”;
3) involving of all enterprise services, including manufacturing, engineer-technical units and also sales and management units;
4) attraction of all stages staff: from top management to operational staff;
5) pursuit to achieve “zero losses” by means of co-ordination of operation of small groups, which responsibility spheres partially decussates.
       Efficiency of TQM system achievable with the help of full elimination of all loses.


SYSTEM OF "SEQUENCING" (5S)




        System of “Sequencing” (5S) includes homing of order, cleaning, consolidation of discipline and support of safe conditions of labor involving all personnel. Name of system includes 5 first Japanese words in Latin transcription, showing its elements: organization, accuracy, cleaning, standardization, and discipline. Given system helps increase productivity, decrease losses, level of discard and injures without additional investments and also helps to create necessary starting conditions for realization of composite and high-value production and organizational innovations, support it’s high efficiency and, uppermost, with the help of radical changes of attitude of staff to it's work. Complex of five “S” creates basis for permanent enhancement of living environment at working time and generates unique constructive spirit helping to staff get pleasure from their work.


Blitz-Kaidzen




       Since 1986, date of edition of book “Kaidzen: key to success of Japanese companies”, term “kaidzen” had been taken in using for indication of one of key management strategies. In Japanese language “kaidzen” means “permanent enhancement”. Meaning of given strategy is next: in the process of enhancement involving all staff, from managers to workers, taking into account relatively small expenses. Even if enhancements in the result of application of kaidzen small and non-regular, some time later it gives surprising results. “Kaidzen” strategy requires strict control of application process. Without aim kaidzen strategy is like the way to nowhere. It’s most efficient when each staff worker tries to achieve final goal, established by management. “Kaidzen” strategy support work of some small teams, i.e. non-formal, voluntary integration of workers within company, that forming for accomplishing particular tasks. The most known sort of such teams is quality groups, designated for solving not only quality problems but also expenses, safety and productivity issues. It could be viewed as part of “kaidzen” strategy, directed to teamwork. Quality groups had played main role in production quality improvement and productivity increasing in Japan, but its role is mostly overestimated by foreign researches who consider that given strategy is most important segment of production quality improvement. Really, conclusive influence makes management, that forming enhancement quality system, personnel training, development and implementing of policy and creates cross-functional quality, expenses and delivery systems. Successful actions of quality groups show that management plays hidden but essential role in its support.
       Blitz-kaidzen is directed, intensive activity helping radically improve single process, duration of which is 2-10 days. Typical example of blitz kaidzen is re-arrangement of equipment in view of compact cell within several days for changing work of consignments to stream of single devices.
       Blitz kaidzen is directed to specific process. In the result it may some situation arise when on the enterprise exists single high-efficiency units but in whole disorder exists. Blitz kaidzen cannot be viewed as substitute of production strategy. One more additional methodic of problems connected with quality in production process solving is 8D methodic. It is disciplined (order) process that directed to solving problems by methodological and analytical way. Main advantages of given methodic are sufficient deep of studying of problem of mismatch appearance, involving management to elimination of mismatches, teamwork for correcting action implementations.

""SIX SIGMAS" "




       The next concept of “six sigmas” is both business philosophy and real tool of improvement. It’s kinds is: - closed circle of processes improvement; - in-build in corporate culture; - practice tested methods of response on the basis of quality measurement system; - process of elimination of discards by means of elimination of its causes. Meaning of given conception is decreasing of variability of processes and stabilization of production characteristics. For corresponding to “6 sigma’s” idee is vitally for indicator of limit for some important characteristic of production to be in some permanent bracket limits in production process. It must correspond to 12 time limit that ±6 sigmas. Experience of many well known companies who had been using given conception: General Electric, Sony, Nokia, Motorola, Kodak, Canon, Johnson&Johnson, Toshiba, showing that permanent quality improvement warranted not only by increasing of customers satisfaction and profit rapid increasing. It gives advantages in staff motivation increasing, stringing of corporate culture and positive image of company, dividends increasing, improving of management system and raising of business per capita etc.


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       Balanced scorecard (BSC) was developed in the 80-90 yy. On the basis of given approach is statement that “Things that cannot be measured, cannot be managed”, i.e. effective productivity management means precisely estimation of activity. Given conception meaning in congregation of different business activities of enterprise. First of all its outlooks of relations with customers, financial outlooks. All system shows set of connected between each other aims, estimations, tasks and incentives, which all together describes strategy of company and ways of its achievement. Nowadays balanced system of coefficients considered as most progressive methodic of estimation of efficiency of staff. The most appreciable specific of BSC is congregation of financial and non-financial indicators, which could be implemented in most efficient way for supporting of management solutions. BSC means utility: serving to customers, valuable to staff, stockholders, society etc that is basis of business, its development. Importance of idee/approach of “utility” within company had been giving popularity of BSC nowadays. Nevertheless, watching more deeply, the reason of “success” of implementing was, first of all, unique idees of changes in this companies, but idee, directed on “tech” was useless, but it was helpful “correctly”: singularly with management principles and values of particular business of company. This is the very important detail, because we influence on cultural part of changes where indicators practically powerful drive.


SELF ESTIMATION




       Improvement of activity of organization holds on making of periodical analysis of work efficiency and its results. Such permanent analysis calls self-estimation – comprehensive, systematical and regular analysis of organization activity and achieved results and also its corresponding to determined criteria. It’s made by self-incentive of company. One of advantage of using of given method is more fully understanding of self-interested parties, its expectations and needs. Outsourcing could make-work more effective by means of using of best experience of other enterprises. Top management valuable information for taking validating decisions of ways of enterprise development. Implementing of given decisions helps significantly increase all business results of company and its competitiveness.

INFERENCE




        All methods mentioned above have been using in most mainstream companies of the world, but its implementation by Ukrainian enterprises slowing due to comprehensive economical and political situation in country. In most cases, mismatch of production quality connected not with shortcomings of quality system in organization but with shortcomings of its management. Integrally, practice proved that establishing of effective quality system on enterprise connected with integration of quality system that is supported with precisely functioning and its permanent improvement in accordance with changing internal and external factors. The most important issue is certification of production and quality system and also strict accomplishing of current legislation in field of quality. All this together assist to increasing of competitiveness of production and services, sequentially, successful activity of enterprise. Solution meaning here is policy of top management of enterprise and their attitude to quality of manufacturing production. All we should recognize that future, when quality is essential factor now is our reality.

LIST OF REFERENCES




        1. A.I. Momot. Quality management and elements of quality system. Nord-Press. Donetsk, 2005. – 320 p.
        2. M.R. Michaylova. Benchmarking – universal tool for management of quality // Methodic of quality
        management.— 2003 — ¹ 5.
       3. http://www.management.com.ua
       4. E.A. Michaylova. Basics of benchmarking. — Moscow.: Yurist, 2002. — 7 p.
       5. A.A. Zorin. Time for «Six sigma’s»//Methodic of quality management. – 2006. – ¹4. – pp. 32-36.
       6. V.A. Lutceva. «Six sigma’s» and linear success vectors//Methodic of quality management. – 2006. – ¹8.
        – pp. 55-57.
       7. A.M. Vlasenko, A.L. Yermolaeva. «Six sigma’s» conception: pilot project of implementation//Methodic of
        quality management. – 2006. – ¹8. – pp. 29-33.
       8. http://balancedscorecard.ru
       9. http://webquality.ru
       10. http://quality.eup.ru


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