Control Mechanisms Paper and The Boeing Corporation
Annette Bauer, Latresha Fowler Ockletree, and Paula Prasatik
MGT/330
Mark Hardee
October 4, 2010
Every organization utilizes some form of control to maintain there organization. Boeing is no exception. Some of the controls that Boeing uses are: six sigma, budgetary controls, Employee Incentive Program (EIP) and Employee Assistance Program (EAP). Control mechanisms are used by organizations to assist in regulating procedures. This paper will identify the way these controls are applied, compare and contrast them, determine the effectiveness of them, examine the positive and negative reactions to the use of these controls and explain how they impact the four functions of
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Boeing states the following in a company newsletter released August 27, 2009:
Therefore, costs previously recorded for the first three flight-test airplanes will be reclassified from program inventory to research and development expense, resulting in an estimated non-cash charge of $2.5 billion pre-tax, or $2.21 per share, against third-quarter results. This charge will have no impact on the company 's cash outlook going forward.
The comparison, effectiveness, and positive versus negative reactions to the use of these control mechanisms are as follows:
• Six Sigma affords the avoidance of a “hit and miss” approach by breaking into measurable bites an entire chain of events leading to a problem, and then coming up with a corrective action (Roff, 2005, p. 1). According to Bateman and Snell (2009, p. 582), the acceptable failure rate is “99.99966 percent level of accuracy.” Although Six Sigma is a powerful control mechanism, it takes about 2-3 years from the time of implementation until its development is fully realized. It is a method that is most useful to a company when it is tailored specifically to a company’s processes. • Feedback affords the necessary communication between varying units and departments but
The driving factors for a success or failure of implementing Six Sigma is largely dependent on the inputs set forth at the conception and duration of the integration. This whitepaper will compare and contrast these critical inputs for a successful deployment. In order to accomplish this five various companies: GE Electric, W.R. Grace, Royal Chemicals, Diversified Paper and Lemforder. Some of these organizations had very successful results while others failed to reach their full potential. What is clear is the similarities of those that succeed and those that failed.
The purpose of this paper is to identify four types of control mechanisms, feed-forward, concurrent, feedback, and financial, and their application in the Starbuck Corporation. The control mechanisms are compared and contrasted along with determining the effectiveness of these control mechanisms, and examining the positive and negative reactions. Finally, students will explain how these controls affect the four functions of management.
Six sigma is a quality management approach that places heightenedmanagerial attention on customer satisfaction and on seeking businessprocess improvements.
Control is typically last in the list of management functions and follows planmng, organi7ing, staffing, and directing. In many ways, controlling is the most important, but it cannot occur until the results of the first four have been implemented. Managers control to ensure that the expected results actually occur after a structure or task is integrated with technology or people. Control depends on information conveyed to managers who continuously monitor sensors to ensure that ind1\ 1dual work results are effective and desirable and that organization objective are accomplished within resource con traints. The management model in Figure 5.8 reflects these relationships. Control allows managers
The board will also have to consider the decades it may take to recoup the costs of starting this project. Development costs in the airline industry are substantial leading to many years of negative cash flows. The introduction of a new plane is a make-or-break activity for the producers and requires huge financing capabilities. The development costs and per-copy costs were difficult to predict, and Boeing also faced engineering uncertainty with the project. The success of the project depends heavily on Boeing’s ability to keep the production costs low and actually deliver a more efficient aircraft than the competition.
Six Sigma is a quality improvement philosophy and a methodology and collection of statistical techniques used to implement that philosophy. Six Sigma’s focuses on reducing or removing identifiable sources of changes in order to decrease the number of defects in a product. Six Sigma was developed by Bill Smith and was used to standardize the way in which defects are tallied (Meredith, 2013). As a new way of doing business, six sigma can have a significant impact on the end result of business. There are many way six sigma can be applied. For example, the scientific component of methodology is a structure approach that takes
The six sigma Black Belt has found and accepted all known underlying drivers for the current open door. The six sigma methodology obliges Black Belts to distinguish arrangements. Couple of thoughts or opportunities are good to the point that all are a moment achievement. As a major aspect of the six sigma approach there must be checks to guarantee that the coveted results are being accomplished. A few investigations and trials may be needed with a specific end goal to locate the best arrangement. At the point when making trials and tests it is imperative that all task partners comprehend that these are trials and truly are a piece of the six sigma
Six Sigma is a process improvement initiative developed by Motorola that assist organizations in identifying and reducing defects and inefficiencies within their existing business processes. The quality management system is a project-oriented system that drives cost savings and increases firm’s profitability by reducing variation in firm’s processes, products and services. (Russell, 2011). The process begins with four steps align, mobilize, accelerate and govern. Companies begin aligning by constructing company-wide metrics surrounding financial and strategic goals of the organization. These metrics are used to determine the area of the business that requires the most improvement and would have the largest financial
Six Sigma was first introduced in the 1980’s by none other than Motorola. It was not however necessarily a novel concept at the time so much as it drew from a conglomerate of proven manufacturing principles. It is strikingly similar to the scientific method in design. Six Sigma approaches areas that may not necessarily be viewed as problematic with an open mind. It seeks to analyze problems or questions with a stepwise, statistical, and quantitative focus in order to discover, fix, or disprove problems that may or may not exist within a process. By doing this Six Sigma can improve efficiency and therefore improve positive outcomes for whatever the endpoint may be (Mast, Bisgaard, & others, 2007).
Six Sigma is a highly disciplined process that helps us focuses on Problem solving and delivering near-perfect products and services. Why "Sigma"? The word is a statistical term that measures how far a given process deviates from perfection. The central idea behind Six Sigma is that if you can measure how many "defects" you have in a process, you can systematically figure out how to eliminate them and get as close to "zero defects" as possible. The Six Sigma methodologies are a business philosophy and initiative that enables world-class quality and continuous improvement to achieve the highest level of customer satisfaction. Metrics established that align an organisation’s strategic goals and values to that of their customer’s needs and
Six Sigma aims to establish the causes of errors, measures those errors, and assess them so that they can be minimized. It has five types of examination that aids to solve problems when utilized. These analysis steps include define, measure, analyze, improve and control. The sigma letter is a character that is occasionally used by statisticians to define the variability of any method, particularly the extent of uncertainty with the outcome. There is a big evidence of proof that the use of this process might lead to an enormous minimization of errors in manufacturing, healthcare or any service that is related to the customer. Moreover, the bigger the sigma the fewer the errors permitted. The goal of sigma converts into a maximum of 3.4 defects per every million opportunities, methods, events, proving that it can be used to solve any problem that any product or service fails to meet client’s needs and requirements (Arthur, 2011).
Goh, T.N. (2002), “A strategic assessment of six sigma”, Quality Reliability Engineering International, Vol. 18 No. 5, pp.
In order to understand control mechanisms, it is important to understand what control means in the management world. Control refers to the workings of individuals being directed to achieve organizational goals. This can be the way that managers keep their employees on track and focused toward meeting their goals. The managers are controlling the employees. In order to meet the organizational goals, there are certain control mechanisms that are used. In Wal-Mart, four examples of control mechanisms used include finance control, distribution control, audits, and performance reviews.
The concept of Six Sigma was developed in the early 1980’s at Motorola Corporation (Harry and Schroeder, 2000). Six Sigma can be defined as a statistical measure of the performance of a process or product (Kumi et. al., 2006). It is used as a quality control mechanism, which seeks to reduce defects or variations in a process to 3.4 per million opportunities thereby optimizing output and increasing customer satisfaction (Sambhe, 2012). Sigma is representing the standard deviation, a unit of measurement that designates the distribution or spread about the mean of a process (Six Sigma Academy, 2002). In addition, the Six Sigma uniquely driven by close understanding of customer needs, disciplined use of fact, data, and statistical analysis, and diligent attention to managing improving, and reinventing business processes (Pande, P., et. al. 2000). The Six Sigma methodology uses statistical tools to identify the factors that matter most for improving the quality of processes and generating bottom-line results. The Six Sigma DMAIC (Define, Measure,
Identify the main output controls, and discuss their advantages and disadvantages as means of coordinating and motivating employees.