III.D.3 Quality system effectiveness
Excerpt From The Certified Manager of Quality/Organizational Excellence Handbook
Balanced Scorecard. A popular method for tracking total organizational performance is to use the balanced scorecard (BSC) approach introduced by Kaplan and Norton.2 This macro-level evaluation is intended to move the organizational decision makers away from considering only the financial factor. A basic approach defines metrics in four areas: customer, internal business process, learning and growth, and financial. Six common process metrics are cost, time, quality, agility (ability to adapt), capacity, and variability. The BSC approach considers metrics in multiple areas and recognizes that all are important to the organization’s success.
Another method used is tracking leading indicators, which tend to be predictive of future performance, versus lagging indicators (easier to collect) that report on past successes or failures. Taking action to affect leading indicators is the secret to managing and understanding a process. Table 11.1 shows a partially completed matrix for a medium-size distributor of small household appliances. The “*” denotes those measures/indicators that are used as performance improvement drivers.
Management Reviews. Considered micro-level, top management reviews, such as required by the ISO 9001 standard, are conducted on a schedule (bimonthly, quarterly, or annually). Key performance indicators, trends, and system problems may be reviewed, such as:
- Customer satisfaction and complaints
- Supplier performance
- Cost of quality
- Internal process/product quality indicators
- Audit results
- Effectiveness of the quality management system
Usually, formal minutes are recorded and distributed to attendees. Action items are assigned, such as corrective actions, matters to research, external contacts to be made, or critical problems. Results of action items from the previous meeting are reviewed and closed out if the issue has been resolved. If an organization is required to meet third-party quality system requirements, full evidence of the activities listed above is required to be maintained and made available for audit review.
Skip-Level Meetings. A micro-level evaluation, skip-level meetings occur when a member of senior management meets with persons two or more organizational levels below, without in-between management being present. The purpose is to get a more grassroots perspective of the effectiveness of the quality system. Care must be taken to not appear to be circumventing the in-between management levels. The intent is to give lower-level employees opportunity to make higher management aware of system problems and needs. Skip-level meetings are often more for venting issues and concerns than for managing the operation. With the advent of internal electronic communication and a more open culture, one-to-one contact between various organizational levels is more prevalent and follows less the chain of command.
Quality Management BOK Reference
III Management Elements and Methods
III.D Quality System
III.D.3 Quality system effectiveness - Evaluate the effectiveness of the quality system using various tools: balanced scorecard, internal audits, feedback from internal and external stakeholders, skip-level meetings, warranty data analytics, product traceability and recall reports, and management reviews.
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