MANA 6333-N1
4 March 2009
Total Quality Management (TQM) vs. Six Sigma: Measuring Success in the Insurance Industry
One of the most frequently asked questions among those in the organizational management world is the difference between Six Sigma and Total Quality Management (TQM). According to BNet Business Dictionary, Six Sigma is defined as “a data-driven method for achieving near perfect quality, analysis can be focused upon any part of production or service activities, and has a strong emphasis on statistical analysis in design, manufacturing, and customer-oriented activities;” TQM as “a philosophy and style of management that gives everyone in an organization responsibility for delivering quality to the customer
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At the operations level, a goal might be to increase the throughput of a production department. At the project level goals might be to reduce the defect level and increase throughput for a particular process. Obtain goals from direct communication with customers, shareholders, and employees.
M Measure the existing system. Establish valid and reliable metrics to help monitor progress towards the goal(s) defined at the previous step. Begin by determining the current baseline. Use exploratory and descriptive data analysis to help you understand the data.
A Analyze the system to identify ways to eliminate the gap between the current performance of the system or process and the desired goal. Use statistical tools to guide the analysis.
I Improve the system. Be creative in finding new ways to do things better, cheaper, or faster. Use project management and other planning and management tools to implement the new approach. Use statistical methods to validate the improvement.
C Control the new system. Institutionalize the improved system by modifying compensation and incentive systems, policies, procedures, MRP, budgets, operating instructions and other management systems. You may wish to utilize standardization such as ISO 9000 to assure that documentation is correct. Use statistical tools to monitor stability of the new systems.
Figure 7-Overview of DMAIC
1. Six Sigma is a management philosophy that sets objectives, collects data and analyzes results as a way to remove wasted expenses from its processes and help reduce the number of defective products produced. Six Sigma uses quality measures to strive for near perfection by eliminating errors and variables.
The following steps need to be taken to improve the performance of a system using the theory of constraints approach;
In this process a particular system is selected and information is gathered about the processes involved in the system, the communication and co-ordination with other departments through interviews, questionnaires and documents. Data management, Medication management and infection control are three areas which are evaluated by this method.
One of the first steps involved in carrying out a preliminary investigation include understanding the problem or opportunity in sight. The analyst must first identify which department, users and business processes the system request is involved in to evaluate and assess the causes and effects related in the proposed system. Defining the project scope and constraints is the second step. With clear indications of the projects boundaries or extent the project scope is determined, while the requirements or conditions the system must confer to or achieve determine the projects constraints. The third step in a preliminary investigation consists of fact finding techniques, that involve the analyses of charts, interviews with users, managers and review of documents , observing operations and finally user surveys. Followed by the fourth step that includes the process of evaluating feasibility. This step consists of evaluating the feasibility of the proposed projects operational, technical, economical and
The system champion will be responsible for leading the team and that particular team will come together and determine the expectations of the project while creating a project plan. The assembled team must get a list together of goals needed to accomplish within the new system and access the way these goals are going to be accomplished. The goal of the information system is to process and store data while keeping information safe and secure for the organization and within this process the important goals need to be understood by all members of the team, and implemented within the system. There are surveys given to the implementation team, and staff members so that the goals are identified by the importance it holds and will play within the process. Once the goals are determined the team is ready to find a vendor who fits the requirements by creating a list of all vendors to send a request for a proposal to the chosen vendors. The only time an organization accepts a request from the chosen vendors is when and if they are willing to do a demonstration for the staff and team members on the site. This on-site demonstration will help the staff to have a better understanding of the system while making an informed decision based on the information presented. This demonstration will also help the implementation team decide which vendor produces the better system while meeting the
Once implementation is under-way the results of the new change to systems and structure must be under constant observation. Change never looks exactly like the expectations of the strategic plan and affected individuals will not always respond as expected, either. Leaders must examine and evaluate target objectives revealing if change is reaching desirable results for the organization.
What do you change in the system so you can ensure the problem won’t be overlooked?
Six Sigma simply means a measure of quality that strives for near perfection. Six Sigma is a disciplined, data-driven approach and methodology for eliminating defects in any process. In another meaning Six Sigma is a highly disciplined process that helps us focus on developing and delivering near-perfect products and services.
The first process of choosing the right information system for SUC is defining the goals of the organization. The first goal is to provide safe, quality healthcare to patients. The second goal is to maintain the necessary financial stability to provide that care. Another important goal is to maintain accurate and secure information within the organization as well as to outside entities as necessary. Investigating, or attaining a clear understanding of how to achieve these goals is the first step. Defining what the system must do to achieve these goals, or system analysis, is the next step. System design will then need to be done to determine how to meet these goals. System implementation is the next step. This occurs when the components that were determined in the implementation step are created or obtained. System maintenance and review is the last on-going step that will maintain the organization and determine what modifications are needed to continually meet the company goals.
The next step in the process is system analysis. This second stage involves gathering requirements, such as documenting the strengths and weaknesses of the current system, having discussions with the users to understand their roles and needs. This is an integral part of the life cycle as employees are the most important asset a company has. Baya, Gruman, & Mathaisel state, “information technology
3. identify alternatives(base case alternative, possible alternative strategies (change existing process without investing in IT, adopt/adapt systems from other organizational areas, Reengineer existing system, purchase off the shelf applications package, Custom build new
Measuring the extent to which a program is achieving its goals and objectives and determining whether the entity is using its resources in the most effective and economical manner
Evaluate the findings and create what will happen as a result of the data break down Identify the successes and the challenges.
For some projects, prerequisites can be met through execution estimation, which incorporates gathering information on the level and kind of exercises (inputs) and the immediate items and administrations conveyed by the system (outputs). Performance measurement evaluates a system's advancement toward its expressed objectives. The information gathered measure particular outputs and results a project is intended to accomplish. Outputs are the after effect of the exercises (inputs) that go into a project, while results are the last consequences of or changes coming about because of an activity. The cost associated with each measurement is as
System development can generally be thought of having two major components: systems analysis and systems design. In System Analysis more emphasis is given to understanding the details of an existing system or a proposed one and then deciding whether the proposed system is desirable or not and whether the existing system needs improvements. Thus, system analysis is the process of investigating a system, identifying problems, and using the information to recommend improvements to the system. System design is the process of planning a new business system or one to replace or complement an existing system.