Finding Value in Total Quality Management
Today’s economic environment challenges companies to do more with less –to continually find new ways to take costs out of their supply chains. As a third-party logistics provider, we’re seeing a far greater demand to be a partner in this process. Companies are turning to us to find new ways to achieve measurable cost reductions.
Since most companies have already made significant cuts and persuaded suppliers to do the same, we’re challenged to dig deeper, to find new ideas for doing things more efficiently and cost effectively.
One strategy that we’ve found particularly effective is to establish a Total Quality Management (TQM) program. Much more than the sum of its parts, a well-designed TQM program leverages elements of ISO, Lean, Six Sigma and more to help companies reduce costs while improving quality and increasing speed to market.
An integrated approach.
Many companies may implement ISO or Lean or Six Sigma, but we’ve found that the greatest impact is to be found when these strategies are used collectively as part of an on-going continuous improvement effort.
ISO standards form a solid foundation for identifying processes and procedures and measuring against them – essentially verifying that you do what you say you’re doing. This standardization provides an effective framework for the program and ensures a high level of dependability and reliability.
With that groundwork in place, it is important to ensure that standardized processes are as efficient as possible. A number of Lean and Six Sigma tools can aid in this process – Gemba Walks, 5S, Kaizen events or Pareto analysis, for example. They prompt critical operational questions: Is product located in the optimal position in the facility to promote efficient and accurate flow? Are orders flowing from customer service to operations in an effective manner and flow back again when completed? How can this process be designed to substantially reduce or eliminate damage? Is the work area laid out visually so that standards are easily repeatable and produce outstanding results?
In addition, traditional engineering support – such as labor standards modeling, facility layouts and analysis, and asset- and non-asset-based modeling – can further help to analyze processes and identify opportunities for improvement.
A continuous cycle.
The true value of a TQM program is found in the underlying commitment to continuous improvement– taking incremental steps toward increased efficiency by reengineering processes, standardizing and documenting them, measuring performance against standards, and looking for more opportunities to eliminate waste.
While this is an intensive process, participants derive significant value from it. Along with a better understanding of their operations, they gain ideas for actionable ways to reduce waste and associated costs and make a commitment to continually review their operations for additional areas of improvement.
Bottom-line impact.
The TQM process can translate to noteworthy cost reductions. It is truly a situation where the “little” things add up: getting more cube efficiency, increasing footprint density, reducing warehouse damage, improving cycle time, eliminating carrier detention and demerge . . . At Saddle Creek, we help customers save millions of dollars on an annual basis, thanks to seemingly minor process improvements like these.
Making a commitment.
Saddle Creek has made a significant investment of time and resources in TQM. We currently maintain ISO certification at a dozen facilities across the country as well as within our transportation group. Our team of in-house TQM experts regularly incorporates Lean and Six Sigma strategies both internally and for customers nationwide. Most importantly, we’ve embraced the philosophy of continuous improvement for our own operations and our customers’.
Going forward, we’ll continue to uphold our commitment to total quality management and actively seek out other ways to help our customers achieve measurable cost reductions. Our brand promise, after all, is to do Whatever It Takes!
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Cliff Otto is president of Saddle Creek Corporation and Saddle Creek Transportation. He has more than 30 years of industry experience and has held leadership roles with the Council of Supply Chain Management Professionals (CSCMP) and several grocery industry associations, and served as national president of the Warehousing Education and Research Council (WERC).