1 THE MANAGEMENT AND CONTROL OF QUALITY, 5e, © 2002 South-Western/Thomson LearningTM

Chapter 10Chapter 10

Productivity, Quality, and Reengineering

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productivity and Quality

The misconception exist that productivity and cost must be sacrificed if quality is to be improved, but it seems to be the view of those who rank production ahead of quality as the top priority.

3 THE MANAGEMENT AND CONTROL OF QUALITY, 5e, © 2002 South-Western/Thomson LearningTM

The Leverage of Productivity and Quality

the leverage is even more dramatic if a smaller and more realistic return on sale is used. There are also potential additional companion benefits that can be achieved in quality.

Management System VS. Technology

4 THE MANAGEMENT AND CONTROL OF QUALITY, 5e, © 2002 South-Western/Thomson LearningTM

Measuring Productivity

Carl G. Thor principle of measurement for productivity and Quality:

• Meet the customer need• Feedback • Measure what is important• Measure should be controllable and

understandable• Base measures on available data.

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Basic Measure Of Productivity Ratio Of Output To Input

• Total Factor: T o t a l O u t p u t Labor+Material+Energy+Capital

• Partial Factor: Total Output

Labor Input

• Functional Department Measure

• Individual Measure

• Industry and competitive Measure

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White-Collar ProductivityCauses of wasted time include:

• Poor Scheduling• Slack start and quit times• Lack of communication• Between function• Information overload• Poor staffing• Inadequate communication of assignments• Unproductive meetings and telephone conversations

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Five ways to increase Productivity

• Reduce cost

• Manage growth

• Work smarter

• Pare down

• Work effectively

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Reengineering

• It has been suggested that in order to reinvent their companies, manager need to abandon the organizatioanl and operational principles and procedures they are now using and create entirely new ones. These new ones can be combined into an emerging idea called business reengineering.

9 THE MANAGEMENT AND CONTROL OF QUALITY, 5e, © 2002 South-Western/Thomson LearningTM

Principle of Reengineering• Organize around outcomes not tasks.• Have those who use the output of the process

perform the process.• Subsume information processing work into the real

work that produces the information.• Treat geographical dispersed resources as though

they were centralized.• Link parallel activities instead of integrating their

result• Put the decision point where the work is performed• Capture information once and at the source.