UTILIZING QUALITY FUNCTION DEPLOYMENT TO CONSTRUCT A BALANCED SCORECARD MAP
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Transcript of UTILIZING QUALITY FUNCTION DEPLOYMENT TO CONSTRUCT A BALANCED SCORECARD MAP
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UTILIZING QUALITY FUNCTION
DEPLOYMENT TO CONSTRUCT
A BALANCED SCORECARD MAP
Shuki Dror & Miryam BaradOrt Braude College Karmiel
Tel Aviv University Israel
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Agenda
Balanced Scorecard Map
Quality Function Deployment (QFD)
QFD Balanced Scorecard Construction Map
Illustrative Example
Conclusions
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Balanced Scorecard Map
The Balanced Scorecard Map is a strategic
frame with four perspectives:
Financial measures
Customer orientation
Internal business processes
Learning and growth
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Cause and Effect Relationships
It develops strategic cause and effect
relationships by linking measures of financial
performances to measures on their drivers.
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Revenue Growth Productivity
Product/Service
Internal Processes
Learning
FinancialPerspective
CustomerPerspective
InternalPerspective
LearningPerspective
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Guidelines are needed
To construct a balanced scorecard map some
basic guidelines are needed.
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Quality Function Deployment (QFD)
Product quality design methodology.
The QFD technique was developed in 1972 at
Mitsubishi and during the 80's and the 90’s
has been gradually and successfully adopted
by U.S. and Japanese firms.
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Quality Function Deployment (QFD)
Extract the customers' needs or desires and
translate them into demands on technical
product characteristics, engineering
parameters and ultimately into production
systems.
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QFD Modeling Approach
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House of Quality
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Example
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Balanced Scorecard Construction Map
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Learning type/level Induced Operational Conceptual
Relative weightCustomer Perspective
Relative weight Internal Perspective
MATRIX 5
MATRIX 3
Quality and service performances Internal Processes
MATRIX 2
Product and service technical performances
Input from customers Product quality & service
Time/cost performancesInternal Processes
MATRIX 4
Inputfrom team
MATRIX 1
Customer perspectiveCustomer types and benefits
Internal perspective Efficiency
Input from management Revenue Growth Productivity
Relative weightsCustomer Types
Relative weightInternal Perspective
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Learning type/level Induced Operational Conceptual
Relative weightCustomer Perspective
Relative weight Internal Perspective
MATRIX 5
MATRIX 3
Quality and service performances Internal Processes
MATRIX 2
Product and service technical performances
Input from customers Product quality & service
Time/cost performancesInternal Processes
MATRIX 4
Inputfrom team
MATRIX 1 MATRIX 1
Customer perspectiveCustomer types and benefits
Internal perspective Efficiency
Input from management Revenue Growth Productivity
Relative weightsCustomer Types
Relative weightInternal Perspective
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Learning type/level Induced Operational Conceptual
Relative weightCustomer Perspective
Relative weight Internal Perspective
MATRIX 5
MATRIX 3
Quality and service performances Internal Processes
Product and service technical performances
Input from customers Product quality & service
Time/cost performancesInternal Processes
MATRIX 4
Inputfrom team
MATRIX 1 MATRIX 1
Customer perspectiveCustomer types and benefits
Internal perspective Efficiency
Input from management Revenue Growth Productivity
Relative weightsCustomer Types
Relative weightInternal Perspective
MATRIX 2
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Learning type/level Induced Operational Conceptual
Relative weightCustomer Perspective
Relative weight Internal Perspective
MATRIX 5
MATRIX 3
Quality and service performances Internal Processes
Product and service technical performances
Input from customers Product quality & service
Time/cost performancesInternal Processes
MATRIX 4
Inputfrom team
MATRIX 1 MATRIX 1
Customer perspectiveCustomer types and benefits
Internal perspective Efficiency
Input from management Revenue Growth Productivity
Relative weightsCustomer Types
Relative weightInternal Perspective
MATRIX 2 MATRIX 2
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Learning type/level Induced Operational Conceptual
Relative weightCustomer Perspective
Relative weight Internal Perspective
MATRIX 5
MATRIX 3 MATRIX 3
Quality and service performances Internal Processes
Product and service technical performances
Input from customers Product quality & service
Time/cost performancesInternal Processes
MATRIX 4
Inputfrom team
MATRIX 1 MATRIX 1
Customer perspectiveCustomer types and benefits
Internal perspective Efficiency
Input from management Revenue Growth Productivity
Relative weightsCustomer Types
Relative weightInternal Perspective
MATRIX 2 MATRIX 2
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Learning type/level Induced Operational Conceptual
Relative weightCustomer Perspective
Relative weight Internal Perspective
MATRIX 5
MATRIX 3 MATRIX 3
Quality and service performances Internal Processes
Product and service technical performances
Input from customers Product quality & service
Time/cost performancesInternal Processes
MATRIX 4
Inputfrom team
MATRIX 1 MATRIX 1
Customer perspectiveCustomer types and benefits
Internal perspective Efficiency
Input from management Revenue Growth Productivity
Relative weightsCustomer Types
Relative weightInternal Perspective
MATRIX 2 MATRIX 2
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Learning type/level Induced Operational Conceptual
Relative weightCustomer Perspective
Relative weight Internal Perspective
MATRIX 5
MATRIX 3 MATRIX 3
Quality and service performances Internal Processes
Product and service technical performances
Input from customers Product quality & service
Time/cost performancesInternal Processes
MATRIX 4 MATRIX 4
Inputfrom team
MATRIX 1 MATRIX 1
Customer perspectiveCustomer types and benefits
Internal perspective Efficiency
Input from management Revenue Growth Productivity
Relative weightsCustomer Types
Relative weightInternal Perspective
MATRIX 2 MATRIX 2
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Learning type/level Induced Operational Conceptual
Relative weightCustomer Perspective
Relative weight Internal Perspective
MATRIX 5
MATRIX 3 MATRIX 3
Quality and service performances Internal Processes
Product and service technical performances
Input from customers Product quality & service
Time/cost performancesInternal Processes
MATRIX 4 MATRIX 4
Inputfrom team
MATRIX 1 MATRIX 1
Customer perspectiveCustomer types and benefits
Internal perspective Efficiency
Input from management Revenue Growth Productivity
Relative weightsCustomer Types
Relative weightInternal Perspective
MATRIX 2 MATRIX 2
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Learning type/level Induced Operational Conceptual
Relative weightCustomer Perspective
Relative weight Internal Perspective
MATRIX 5 MATRIX 5
MATRIX 3 MATRIX 3
Quality and service performances Internal Processes
Product and service technical performances
Input from customers Product quality & service
Time/cost performancesInternal Processes
MATRIX 4 MATRIX 4
Inputfrom team
MATRIX 1 MATRIX 1
Customer perspectiveCustomer types and benefits
Internal perspective Efficiency
Input from management Revenue Growth Productivity
Relative weightsCustomer Types
Relative weightInternal Perspective
MATRIX 2 MATRIX 2
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Induced Learning
Induced learning is training at the individual
level and developing/enhancing Information
Systems/Technology.
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Operational & Conceptual Learning
Operational learning and conceptual learning
are viewed here as combinations of
organizational structures and improvement
tools.
Both operational learning and conceptual
learning involve teams.
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Operational Learning
Operational learning as being achieved by
means of local teams using rather basic tools
such as the seven basic graphical tools or
SPC.
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Conceptual Learning
Conceptual learning has a wider scope and as
such has to rely on cross functional teams
applying more sophisticated tools such as
enhanced QFD and advanced statistical tools
such as Design of Experiments (DOE).
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Illustrative Example Illustrative Example
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Cross Functional Team
Finance Market oriented Information systems Human resource members Industrial engineers R&D representatives
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Benefits
Customer Perspective
Internal Perspective
Retailers:Service
performance
Users:Product
performance
Managers:Efficiency
Revenue Growth2515
Productivity--53
Importance 10252055
Normalized Importance0.200.450.351
Imp
orta
nce
Matrix 1 - Deployment of the financial perspectiveMatrix 1 - Deployment of the financial perspective
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Matrix 2 – The House of Quality in simplified form Matrix 2 – The House of Quality in simplified form
Product and service technical performances
Product characteristics(Quality)
Service characteristics
)Time()Flexibility(
variation of Solids
%
Calciumcontent
Fat %
Additives
Life length
Deliverytime
Packagesize variety
Ordermodific
ation
Nutritious431.21.6
Not fatty5251.53.8
Fresh5210.9
Delectable34541.52.7
Consistency 4151.53.8
HandlingCost
43410.8
Cost of Stock
5451.51.5
LowRisk
1451.51.5
Importance 247302658515120
Normalized Importance 0.200.060.250.220.040.070.040.121
Cu
stom
er P
ersp
ecti
ve
Use
rs (
0.45
)
Pro
du
ct p
erfo
rman
ce
Ret
aile
rs (
0.20
)
S
ervi
ce p
erfo
rman
ce
Imp
orta
nce
Sal
es P
oin
t
Wei
ghte
d I
mp
orta
nce
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Matrix 3 – Deployment of product/service technical characteristicsMatrix 3 – Deployment of product/service technical characteristics
Quality/ service performances of Internal Processes
Design Quality
Process QualityProcessTime
Response
Userreviews(rank)
Range of packaging
size
Process capability
(Scrap rate)
Quality assurance
effort
Manufacturing & transfer
FailuresSupplier lead time
Information /Com
Versatility(Human)
Set up
Ordermodification
1115540.12
Packagesize variety
50.04
Deliverytime
5443330.07
Life length3332310.04
Additives5320.22
Fat% 40.25
Calciumcontent
30.06
Variation of % Solids
4530.20
Importance 3.20.201.781.160.550.520.400.810.810.7310.2
Normalized Importance (NI)
0.310.020.180.110.060.050.040.080.080.071
0.65 *NI 0.200.010.120.070.040.030.030.050.050.050.65
Imp
orta
nce
Fle
xib
ilit
yT
ime
Qu
alit
y
Pro
duct
an
d se
rvic
e te
chn
ical
per
form
ance
s
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Matrix 4 – Deployment of internal efficiency Matrix 4 – Deployment of internal efficiency
Time/cost performances of Internal Processes
Process CostProcess TimeResponse
Manufacturing & transport
Waste WI P
Manufacturing &
transport
Failures
Supplier lead time
Information /Com
Versatility(Human)
Set up
Flexibility5555
Production (rate)
234334445
Asset utilization
234424444
Cost per unit
5535321223
Importance 51213181410232424143
Normalized Importance (NI)
0.030.080.090.130.100.080.160.170.171
0.35 *NI 0.010.030.030.040.030.030.060.060.060.35
Eff
icie
ncy
(0.
35)
Imp
orta
nce
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Learning Induced
KnowledgeOperational Knowledge
(Local Teams)
Conceptual Knowledge
(Cross Functional Teams)
Training Informationcapability
Basicseven tools
SPCQFD(Enhanced)
DOE
Set up 440.11
Versatility (Human)53220.11
Information /Com54230.11
Supplier lead time230.06
Failures
414220.06
Manufacturing & transport20.08
WIP40.03
Waste34330.03
Manufacturing & transport10.01
Quality assurance effort5244430.07
Process capability(Scrap rate)
22550.12
Range of packaging size50.01
User reviews(rank)
550.20
Importance 1.471.152.281.311.882.6810.8
Normalized Importance0.140.110.210.120.170.251
Structure Importance 0.250.330.421
Matrix 5 – Deployment of internal process performances Matrix 5 – Deployment of internal process performances In
tern
al P
roce
sses
R
esp
onse
Pro
cess
T
ime
Pro
cess
C
ost
Pro
cess
Q
ual
ity
Des
ign
Q
ual
ity
Imp
orta
nce
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Conclusions
The QFD matrices ensure that every financial performance defined by the enterprise strategy is linked to a set of performance measures in the relevant domains that may eventually influence its future results.
Through QFD, priorities for improving performance measures in each of the three other domains are determined.
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Conclusions
The QFD matrices warrant that proposed learning actions are consistent with eventual financial results.
The QFD systematic approach assists in organizing the balanced scorecard thus promoting continuous improvement for achieving strategic goals.
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