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Productivity Improvement Methodologies: A Comparison

Conference Paper · January 2008

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 PRODUCTIVITY IMPROVEMENT METHODOLOGIES:
A COMPARISON

Mustafa Ramzi Salman1, Malcolm Brady2, and John Geraghty1, *

1
Enterprise Process Research Centre, School of Mechanical & Manufacturing Engineering,
Dublin City University, Ireland
2
Enterprise Process Research Centre, DCU Business School, Dublin City University, Ireland
*
Correspondence Tel: +353 1 700 7739, Email: [email protected]

ABSTRACT:
An array of methodologies and techniques are available aimed at addressing the
effectiveness and efficiency of operational activities within Enterprises. An enterprise is an
agreement between a set of organisations that cooperate to form a supply network to achieve
a mutually beneficial goal such as the delivery of products and/or services to customers

The literature and engineering body of knowledge contains a wide variety of tools for
enhancing an enterprise or its components. Examples are Scientific Management, the Deming
cycle, Lean Thinking, Six Sigma's DMAIC model, Business Process Re-engineering (BPR),
and Business Process Management (BPM). The models and techniques differ from each other
due to the engineering/technical domain from which they have originated. The origin of the
technique influences the focus of the technique on how improvement should be approached
and carried out. For example, Lean Thinking is predominately a manufacturing/industrial
engineering philosophy that focuses on the elimination of waste from a system. The tools and
techniques employed have evolved from common sense industrial engineering methodologies
and do not necessarily rely on complicated statistical tools to generate improvements, but
rather focus on developing a mind-set of continuous improvement over breakthrough
innovation. Six-Sigma on the other-hand has its origins in the fields of Quality Management
& Control and Statistical Mathematics. The emphasis is on the application of statistical
experiment design tools and techniques to accomplish continuous improvement. So both
philosophies emphasise continuous improvements but the methods and tools are different due
their origin in their respective fields.

In this paper, these productivity improvement philosophies and problem solving

methodologies with their varying aims and implementations processes are discussed and
compared. It becomes apparent from the review that there are key similarities between the
diverse approaches. This paper highlights these key performance factors and comments on
their attributes on the path to pursue perfection and explores the means by which some of
these techniques may be integrated for better enterprise management.

KEYWORDS: Industrial Efficiency, Productivity Improvement, Problem Solving

1
1 Introduction:
In modern enterprises, the business environment consists of unpredictable varying
factors and the economy is continuously struggling to balance overcapacity with
globalisation. Success in today’s market does not put emphasis on the need for giant
multinational corporations, nor does it advocate sole trader businesses. It generally depends
on the individual circumstances and nature of the business in question. That’s why; the
method used in executing the knowledge available has a distinct impact.

What happens when old solutions no longer work – when the external world changes in such
a way that existing components and design principles are no longer adequate? What does a
company do when the competition stiffens and it needs something better than the me-too
solution to maintain its market share? This is a job for research as opposed to development -
the conscious process of inventing, perfecting and introducing something that is new [1].

There are numerous problem-solving techniques and improvement methods available in

literature and practice. Determining the most appropriate method for the issue at hand is
another complication of its own. Many authors of the theories, covered in this paper, were
originally determined to develop the right metrics to solve their predicament in a certain
subject/field/industry in their own respective era. However, further down the line,
practitioners attempt to generalise their resolution to cover a wider spectrum in order to allow
other practitioners to avail of the knowledge in their own varying uncertainties.

Throughout the surveyed literature of problem solving and improvement methodologies,

there are as many techniques as there are problems (Oslapas, 1993) [2]. Most approaches are
typically viewed as multi-step experiences. For each of the various problem types,
researchers have identified a number of solutions [3]. To examine every possible technique
available is not viable and would not serve the objective of this review any further. Therefore,
in this comparison review, some influential and commonly used methods and techniques are
covered to give the reader a sense of the enormous variety available.

2 Review of Key Problem Solving Techniques:

To start reviewing the methods and techniques one should begin with some of the earlier
entries in literature, such as Adam Smith (1723-1790), Eli Whitney (1765-1825), and the likes
of Charles Babbage (1791-1871). However, a requirement for selecting methodologies for
review was to choose a working technique, i.e. with sequential steps that demonstrate the
application of an underlying principle that is currently used. In this review the work of
Frederick W. Taylor (1856-1915) was chosen as a starting point, the reason for this is that
Taylor’s work converted into highly influential advancements in industrial efficiency and his
ideas and principles are well documented and are still in practice today.

Taylor introduced the industrial world to Scientific Management. His idea was to analyse
work to find the single best way to do a job. The Scientific Management method was to break
a job into its component parts and conduct analysis and measurement of each part [4].
Although having originated in the industrial sector, Taylor’s approach can be adopted to

2
solve problems in a range of different types of organisations, varying from government and
healthcare down to the service fields. Taylor had an impact a number practitioners of his era
and successor to come; Frank B. Gilbreth’s discovered scientific management while working
in the construction industry, developing motion studies independently of Taylor [5], this
logically complemented Taylor's time studies, which eventually became the field know as
Time Motion Study [6]. The key feature to Scientific Management is more than just a
collection of techniques, but it also involves the philosophy of approaching a problem in a
logical manner. A key component of Taylor’s approach is intermittent feedback; this helps
maintain a connection between the different phases of the Scientific Management technique
and also as the cyclical aspect to the method emphasised the approach to continues-
improvement [7].

The most famous example in improvement literature of this cyclical approach is the Deming
Cycle; also known as the Deming wheel, Shewhart cycle, Plan-Do-Check-Act. It is a
problems solving concept that originated from the scientific methodology of Francis Bacon
(1561-1626) (Novum Organum, 1620). The method initiate an improvement solution with a
Plan (hypothesis); the plan is executed by Do (experiment); the information resulting from the
experiment is Checked and Studied (evaluation). The final stage of Act (conclusion)
completes the cycle by applying actions to the outcomes for necessary improvement [8]. The
key principle of the Deming cycle is iteration. Once a total rotation is completed, executing
the cycle another time will broaden the knowledge further [9]. This understanding is based on
the principle that our knowledge and skills are limited, but with continuous learning it can be
improved with no potential limit. With the improved knowledge of every cycle, one is also
able to visualise an improved representation of the process and refine or even change the
ultimate goal. Hence, generating a process of continuous learning and improvement; on
completing each reiteration, the goal will be a step closer.

A respected promoter of continuous improvement is the methodology of Lean Thinking,

which is a philosophy that originated from the Toyota Production System concept. Lean
Thinking strives to eliminate all types of waste from a system, may it be a value-stream, a
manufacturing process, or even a routine operation. The concept of Lean is not restricted to
manufacturing and applies to the whole enterprise; including supply chains, product
development processes and the provision of services. The Lean Thinking process as
identified by Womack & Jones [10] seeks to specify Value as being defined by the customer,
and identifying the Value Stream in which it operates. Lean Thinking enables streamlining
the flow of operations and helps focus on removing bottlenecks and areas of constraint [10].
This provides its customer the option to pull demand when needed and the supplier to only
supply when required. Facilitating both parties to achieve capital savings on inventory
investments and shorten their lead times. As the supplier only produces when the customer
pulls, facilitates for customisation to match the customer’s unique needs. Furthermore, the
lean concept strives in its pursuit of perfection through incremental continual improvements
(Kaizen) [11].

3
 TAYLOR’S LEAN BUSINESS
SCIENTIFIC PROCESS
MANAGEMENT THINKING REENGINEERING

1900 1950 2000

DEMING SIX SIGMA’S BUSINESS

PROCESS
CYCLE DMAIC MODEL MANAGEMENT

Figure 1 - Methodologies origination time-line.

Companies and organisations now and then need to seek unique strategies in order to increase
efficiency and functionality to survive in today’s market. These enterprises are seeking
professional expert advice to improve their organisational processes to maximise their
potential. A popular option in the 1980’s/1990’s was Six Sigma and is still widely used
across the globe. Six Sigma consists of a set of statistical methods for systemically analysing
processes to reduce process variation, which are sometimes used to support and guide
organisational continual improvement activities. Six Sigma's toolbox of statistical process
control and analytical techniques are being used by several companies to assess process
quality and waste areas to which other Lean methods can be applied as solutions. Six Sigma
is also being used to further drive productivity and quality improvements in Lean operations
[12].

One improvement strategy being productively implemented since the emergence of Six
Sigma in the 1980’s is the Six Sigma DMAIC Model [13], which signifies to Define-
Measure-Analyse-Improve-Control inspired from the work of W.E. Deming. Six Sigma
experts are highly enthusiastic about this model for overall business success through quality
control, problem management, and common sense (linking Six Sigma back to Lean
Thinking).

In 1990, Michael Hammer’s Harvard Business Review article “Don’t automate, obliterate”
[14], started the Business Process Reengineering (BPR) movement. Hammer and Champy
[15] define BPR as ‘...the fundamental rethinking and radical redesign of business processes
to achieve dramatic improvements in critical contemporary measures of performance, such as
cost, quality, service, and speed’. Business Process Reengineering is less explicitly focused
and results in a more general improvement methodology than the other methodologies in this
review. Its particular approach is to consider radical change as a means of improving
operations [16]. This subversive change allows new, revolutionary ideas to develop; these
may make a dramatic change in performance, in contrast to the evolutionary and incremental
improvements that are often conveyed by the more focused methods such as Lean Thinking,
Six Sigma and even Taylor’s Scientific Management [17].

4
A recently emerging fast spreading method used by enterprises across the world is Business
Process Management (BPM). BPM is a method of efficiently supporting an organisation with
the wants and needs of customers. It is a holistic management approach that encourages
business effectiveness and efficiency while striving for innovation, flexibility and
incorporation with technology [18]. As organisations strive for realisation of their objectives,
BPM attempts to continuously improve processes; the process to define, measure and
improve your processes. BPM can therefore be seen as a ‘process optimisation' method [19].

3 Comparison of Methodologies:
After reviewing several methods and techniques in the previous section, it becomes
apparent how many different possibilities are actually available. Yet when studying these
techniques in more detail, some aspects become common to the wider spectrum.
Improvement methods in general have basic similarities in a number of the phases involved,
and their cyclical nature (Grunberg, 2003) [20]. However, direct comparison can be difficult
at times, since they originate from different areas of research and practice. Improvement
methodologies generally have the following key phases; Problem Definition phase [21], Data
Collection phase [22], and Commitment/ownership (from both staff and management) phase
[23]. Furthermore, most methods typically include, but not always, a Measurement phase and
an Implementation phase [24]. The final phase generally concludes with some form of
evaluation and a restart of the improvement cycle [20].

All these methods have an analogous elementary aim, which is to improve operations and
productivity. However similar they are in their own respect, there are differences in the way
they attempt to accomplish this improvement and their particular scope. A common failing is
that these methods do not give decision support as to which performance category to
improve. When it comes to measurement, the literature often lists specific measurements to
be made, hence, giving a suggestive indication that the improvement methods are static.
Since operational activities are dynamic in nature, so should the improvement method used
[20].

Usually when attempting to solve a problem, the process starts with defining the problem and
only then can gathering and analysing data begin, which then infuse into different
calculations to aid their interpretation and conclude with some logical results [25]. These
outcomes are used to derive assumptions and hypotheses that can be employed to tackle the
problem at hand.

All the methods reviewed previously, start out by identifying Value. The Value is dependent
on what the user is seeking out of enrolling into a project. The customer is usually the first
place to start when deriving the specifications that define Value aspects. Deming’s work
covers this in the “Plan” section [9]. Taylor’s Scientific Management initiate’s with “problem
definition” after opportunity of improvement is observed [7]. BPR defines the first step as
“Identifying the Process’s Customer Driven Objective” [17]. Furthermore, Six-sigma has the
“Define” stage which sets its project aim for a given improvement attempt. Finally arriving at
Lean Thinking, the poster child of Toyota’s Production System, considered the benchmark

5
business model, states that the road to leanness begins by “Specifying Value” [10]. So if all
those well recognised and widely used techniques preach the importance of defining value,
thus it must be the correct starting point. However, one must note that it is an important step
to be performed with prudence, as defining the wrong value will result in rouge outcomes of
no benefit.

Every improvement effort or problem solving attempt must include some data collection and
analysis. To successfully gain solutions, data must be gathered and precisely evaluated to
help reach a conclusion or back information to aid interpreting a conclusion. BPR’s second
step is “Collecting and Analysing Information from the Existing Process” in order to analyse
[17]. This compares to Six Sigma’s “Measure & Analyse” which are the phases of
information collection and processing [13]. Again it is very important to collect the right data
and to elaborate the information in an appropriate manner; otherwise the objective being set
may not be appropriately addressed.

A common observation was the use of visual aid tools in problem solving by all
methodologies. This can be in the form of graphs, charts, or visual maps that illustrate
characteristics of the process or system. In Taylor’s Scientific Management, constructing
models helps the user visualise and manipulate the process by testing different scenarios in
order to choose the one that would achieve best result to improve the system [7]. Similarly in
Lean, Value Stream Mapping helps visualise and simulate the flow of value throughout the
structure [26]. BPM also offers visualising tools in the “Mapping and Measuring the Existing
Process” phase.

Given the above similarities brings up a central question to this review, “Which problem
solving technique or improvement method is the optimal one”? [27]. The simple answer to
this question is that a single optimal problem solving method does not exist for most problem
types. In general, the choice will depend on the goal of problem solving, and on the
characteristics of the specific inputs. The problem solving methods are selected from existing
sets, or sometimes configured from a combination of available methods. In conclusion, it
is said that the best technique is the one that works for you [2].

4 Conclusion:
It is important for an enterprise to foresee and be able to control or adapt for its future.
This is why there are countless methods and techniques developed throughout time to assist
forecasting. Knowing what is going to happen, allows for management to modify or adjust
their actions in order to control the future outcomes. There are many methods available to use
in the solving of problems and improvement efforts. Some are quite generic, but others
(relatively) concentrate on a specific business model. However, most of them share some
fundamental similarities. These similarities prove to be key factors in any given investigation
into problem solving or improvement. This involves first deciding on key factors to be
improved and then selecting a method or a combination of methods most appropriate for a
given circumstance. This is pursued by an emphasis to measure progress and monitor
outcomes.

6
Finally the concluding fact that most methods point out is that perfection is never achieved
and that once an ideal future state is defined and worked on, this ideal state keeps developing
as the process is further enhanced and new areas of waste are exposed. The key point is never
to stop perusing perfection, thus improvement is a continuous process. An answer for a
problem does not always necessarily mean it’s the best solution, there is always the
possibility of a better solution existing and perhaps exercising different techniques to the
same problem, would result in a wider variety of resolutions of which to choose from.

5 Acknowledgements:
This research is funded by the Embark Initiative from the Irish Research Council for Science,
Engineering and Technology (IRCSET) and the National Development Plan (Grant
Reference Number: RS/INTEL2/07).

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