Quality Improvement and Performance Analysis

Most companies, concerned about sagging productivity, tend to place too much emphasis on the quantity of work turned out per employee, as opposed to the quality of work produced.

You can download excellent powerpoint slides on HR management, business strategy and personal development HERE.

The amount or quantity of a particular product or output produced by an employee is easily measured and often serves as the basis for a performance rating, pay raise or promotion. As a result, quality is often lost in the rush to produce. And the once omnipresent words “Made in America” are giving way to foreign labels.

The trade-off of quality for quantity is particularly obvious where management has built in strong financial incentives for meeting output standards or has developed so many punitive consequences that workers feel forced to maintain high production standards despite obviously poor workmanship.
In one instance, a Texas firm developed so many negative consequences for failing to meet shipping schedules that the shipping department would occasionally ship out scrap material just to meet monthly production goals.

We’ve all heard managers and supervisors ask, “If we reward quality, won’t quantity slacken?” Possibly, but not if management sets quantity and quality standards, measures both and rewards desired behavior in relation to its respective economic payoff.

You can download excellent powerpoint slides on HR management, business strategy and personal development HERE.

Four steps toward quality
The following is a four-step checklist designed to improve the quality of performance.

1. Performance Analysis. One of the first steps in improving quality involves doing a Performance Improvement Analysis (PIA) to define and establish measurable standards for what the organization, department or individual worker should produce as outputs of performance.

Quality considerations are not limited to tangible products alone but also apply to every organization and work behavior— selling techniques, customer service, and so on.

Besides setting measurable standards for quality, managers must also establish standards for other dimensions of performance, such as quantity, rate and timeliness.

Most organizations have difficulty setting standards. Frequently, they fail to define specific standards for quality. Therefore, vague standards must be translated into specific performance outputs that can be measured.

When a vice-president of a major airline was asked to define the quality standards for the company’s gate and ticket agents, he replied, “Offering friendly service to passengers.”

But what did this mean? After a week of observing performance and interviewing managers and passengers, it was determined that “friendly service” could actually be translated into 50 measurable performance outputs, such as “calls passenger by name when ticket is picked up” or “looks passenger in the eye and smiles.”

Clearly, these actions are observable and can be measured.

The director of the engineering department of an aerospace company said he could not define quality of work.

After he was questioned by an experienced consultant for two hours, he was able to come up with approximately 14 measurements of quality. For draftsmen in the department, for example, the measurement was the number of drawings submitted without error.

2. Measure the Baseline. Without a baseline measurement of performance, you cannot judge whether your performance improvement pro¬gram is successful. What is your organization’s, department’s or subordinate’s current level of performance? To get a handle on what is already being produced and how it is being produced, managers and supervisors must gather the required baseline in-formation.

This generally can be accomplished by reviewing past records, performance reports or customer complaints or by discreet on-the-job observations.

3. Economic Analysis. For many organizations, there is a greater economic payoff for improving the qual¬ity of products or services rather than for increasing the quantity. Improving or maintaining the quality of a product or service does not lie alone in new breakthroughs in engineering or technology. Rather it rests with im¬proving the performance of people who operate the machines, who make the sales calls and who control the production lines.

In one organization, for instance, 58% of all expense dollars were in materials. Yet the company failed to set any standard for waste per machine operator. In this instance, a 10% reduction in the amount of material waste was worth five times more than a 10% increase in labor productivity.

Many organizations make the mistake of defining standards in terms of what management thinks is important instead of what the customer really wants. Quality of product or service must be viewed from a customer standpoint.

One air freight forwarding company, for instance, put undue emphasis on measuring the number of deliveries made within one day after pick-up.

However, when a market research study of customers’ actual buying habits was conducted, it was determined that 40% of the customers who stopped using the company’s service did so because of extended delivery delays (7 days, 14 days, 30 days). Preventing these extended delays in delivering packages, not increasing the number of deliveries made by the first day, represented the greatest payoff for the company.

4. Cause Analysis. Any program designed to improve the quality of employee performance requires that management adopt a systems approach to determine both the internal and external factors affecting the quality of product or service. Such an analysis, which would pin¬point all the adversely affecting employee behavior, should ask the following questions:

1. Are the standards for performance specific?
2. What type of feedback systems are provided to the worker, supervisor or manager?
3. What are the consequences to the worker, manager or supervisor of quality performance?
4. Are the necessary tools available to the employee for quality work performance?

In one instance, it was discovered that quality problems developed not because of poor employee motivation but because workers were given outdated blueprints.

5. Do the employees know how to utilize the available tools?
6. Are the employees trained to do the job correctly?

One critical phase of a performance analysis is an investigation into the kinds of stimuli workers should reapond to in order to produce an output and then an examination of those particular responses. For an assembly-line worker, the part moving down the assembly line would serve as the stimulus to action.

You can download excellent powerpoint slides on HR management, business strategy and personal development HERE.

For a salesperson, the stimulus would be the needs expressed by the customer. What are the employee responses to the stimuli? When two workers exhibit sharply divergent reactions to the same stimuli, additional training is obviously needed.

Using information gleaned from a cause analysis, training and development personnel can construct a program for improving performance quality by training supervisors and managers in performance improvement analysis, feedback systems and managing performance consequences.

Other approaches to improve quality may involve team-building efforts and encouraging the worker, supervisor and manager to analyze causes of quality problems and suggest and implement solutions. However, unless these employees are trained in performance analysis, feedback systems and managing performance con-sequences, they will invariably over¬look the true causes of performance deficiencies.

Such a behaviorally tailored performance-improvement system is based on the principle that people will tend to increase those behaviors for which they receive positive consequences. Negative consequences for behavior will only serve to reduce the probability that an employee will respond in a desired way.

In the work environment, a performance improvement program should provide feedback to the performer that allows him or her to continually measure performance against established standards and ‘should positively reinforce desired behavior.

One of the greatest tools for improving the quality of worker performance is an effective feedback system. But most organizations lack adequate feedback mechanisms to provide workers with a continuous means of monitoring quality performance.

Many times, organizations will delay feedback for several days or even weeks or will provide feedback to the entire group rather than to the individual. As a result, performance deficiencies go unchecked.

To be effective, feedback must be immediate and directed at the individual performer rather than the group. It should also contain the necessary data for self-correction of performance deficiencies.

Feedback should be provided continuously and frequently. Effective feedback should restate baseline performance standards and indicate progress toward established performance targets. When it does, the performer knows whether his or her performance output is meeting desired standards.

Besides providing immediate and adequate feedback, any system geared to improve performance must contain a program to reinforce desired behavior. Rewards for such behavior can take many forms— money, official recognition and praise, paid time off, promotion to greater responsibilities or whatever is applicable in a given situation.

Some jobs have built-in negative consequences for performance; these must be counterbalanced with posi¬tive reinforcement. For instance, a major oil company found that gas station attendants checked oil levels of customers’ cars only 11% of the time. The consequences for checking the oil were mostly negative: it was a dirty job; the attendant had

To wrestle with the car hood; the weather was often disagreeable. To the attendant, checking the oil was unrewarding work. To combat these negative con¬sequences, the oil company initiated a contest: attendants would receive points each time they checked a car’s oil level. Attendants with the highest point totals over a specified period of time received prizes.

As a result of the contest, attendants were soon check¬ing oil in 72% of all cars. However, when the company later eliminated the contest, performance levels quickly dropped among the attendants—back to 11% of all cars.

The following example illustrates how these principles of feedback and positive reinforcement converge to affect employee performance.

A large manufacturer of heavy machinery was experiencing a higher than acceptable rate of quality control rejects. In fact, nearly 50% of labor time was spent in reworking rejected items. As a result, the company was consistently failing to meet production schedules and necessary overtime costs were costing millions of dollars.

The company called in an outside consultant to help analyze the problem. A task force consisting of management personnel was formed and their subsequent investigation uncovered the following four major deficiencies:

1. Inspection supervisors were receiving inadequate feedback about what items needed inspection.
2. Workers were receiving inade¬quate feedback about the quality of work.
The foreman gave work assign¬ments orally. And there were few written records of who did what. As a result, rework frequently wasn’t as¬signed to the originator of the job.

3. Foremen were not checking their employees’ completed work. The foremen would merely sign off work as completed when the worker told him it was done. Because the foremen didn’t check the item for obvious problems, the inspector often wasted time writing rejection reports for obvious defects or incomplete work.

4. Furthermore, consequences to the worker for improving quality were weak and most punitive (criticism for errors). There was no reinforcement for the worker who tried to meet quality standards. In fact, the poor performer might get a larger pay check because of the overtime required for rework.

The plant’s wage incentive system paid according to completed items and an item was considered complete when the foreman signed it off. Payment could be withheld for rejected items; but because the inspectors were slow, it was possible to increase the week’s paycheck by doing a large quantity of poor quality work.

After the task force analysis pin¬pointed the performance deficiencies, its members developed possible solutions and conducted a test model at one of the company’s work areas. Then they implemented the following solutions.

1. The plant foreman checked the backlog of items to be inspected for each work area. The inspection supervisor then assigned his inspectors to the work areas with the largest number of items to be inspected. As a result, the average age of completed items awaiting inspection was reduced 37% to 1.16 days.

2. Foremen were also instructed to pre-inspect each employee’s work be¬fore signing it off as being complete. This procedure provided immediate feedback to the performer about the acceptability of his or her performance. While this inspection wasn’t as thorough as that conducted by the inspector, it meant that many obvious problems could be noticed quickly and repaired while the worker was available and the proper tools were at hand.

3. The foreman, meanwhile, was evaluated on the number of items he signed off as acceptable and which later were accepted by quality control inspectors. As a result of this consequence system, the number of items accepted by the foreman but later rejected by quality control was reduced by 43%.

4. Foremen were also instructed to keep a written record of all worker job assignments. If an item was rejected by quality control, the worker who initially completed the item was assigned the rework.

5. Foremen were trained to praise workers for high quality work and were encouraged to use a positive, rather than a negative, approach.

A worker whose item was rejected by quality control would not be critized. Instead, the foreman would explain the problem and encourage the worker to do a better job next time. As a result, workers at the test area reacted favorably to the change in the foremen’s emphasis and began to offer their own solutions to quality problems.

You can download excellent powerpoint slides on HR management, business strategy and personal development HERE.

Source : TRAINING Magazine

HR English Jpeg RE