A Brief History of Excellence

maart 25th, 2013 · by John · Weblog EN

The ancient Greeks called it Aretè, often translated as virtue, but “reaching our highest potential” or excellence comes nearer to the original concept. Excellence is about superiority in a good way, having an unusual degree of good qualities. We can strive for excellence but we will never reach it, because there will always be another business trying to outdo us. The journey for excellence therefore never ends, and we must keep on looking for new ways to improve our organization.

The Wealth of Nations

Business excellence in the sense of improving the performance of an organization started with Adam Smith. In his “Wealth of Nations” (1776) Smith recognized how division of labor could increase output. In a society where production was dominated by handcrafted goods, one man would perform all the activities in the production process. Smith described how that work was divided into a set of simple tasks, performed by specialized workers.

Scientific Management

In the last decades of the 19th century, Frederick Taylor started the scientific management movement.  Taylor believed in transferring control from workers to management. He increased the distinction between mental (planning) and manual labor (executing). Detailed plans specifying the job, and how it was to be done, were to be formulated by management and communicated to the workers. Scientific management had a huge impact on mass production principles. Henry Ford significantly improved productivity by organizing processes differently. He for instance introduced the conveyor to organize an assembly line, and standardized methods and tools to decrease variation and cost.

Toyota Production System

World War II left Japan a poor country. Scarcity of resources and technology forced companies to focus on efficiency and customer requirements. The idea of continuous improvement was one of the most important innovations of this era. These new principles became part of the most successful business case of all times, the Toyota Production System. The objectives of TPS were:

  • To design a process capable of delivering required results smoothly without inconsistency.
  • To ensure processes are flexible without stress or overburden since this generates waste.
  • To address waste (anything that does not advance the process or everything that does not increase value).

Total Quality Management

The 1980s showed the birth of Total Quality Management. TQM was a management philosophy for continuously improving the quality of products and processes. Its basic principle was that meeting or exceeding customer requirements is the responsibility of everyone involved in the creation or consumption of products and services.

Six Sigma

Two decades later Six Sigma came into being. Six Sigma aimed for an error free business performance with a rigorous focus on meeting or exceeding customer requirements. Six Sigma included the tools and philosophies of TQM, but also led to improvements.

  • TQM failed where management did not participate and backed it up. Six Sigma required management involvement.
  • TQM did not require teams to work on projects and creating a culture of continuous improvement. Six Sigma did.
  • TQM never defined a methodology for its implementation. Six Sigma provides an improvement model known as DMAIC.

Six Sigma also had more advanced statistical tools than TQM. Incorporating these tools created opportunities for bigger and better improvements.

Lean

Lean had its roots in the Toyota Production System. The core idea was to maximize customer value by eliminating waste. Lean therefore meant creating more value with fewer resources. It changed the focus of management from optimizing separate technologies, assets and vertical departments, to optimizing the horizontal flow of products and services through value streams that flow across technologies, assets and departments to customers.

Lean Six Sigma

Lean focused on reducing waste by creating efficient processes. The focus of Six Sigma was on creating perfection in the output of these processes. As both systems were complementing each other, Lean and Six Sigma were combined into Lean Six Sigma (LSS). LSS incorporates all proven tools and philosophies and, because it is open to new and better methods, it helps us in our continuing strive for excellence.

John Greijmans

 

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