The Five Steps to Increase Profitability and Competitiveness

The Five Steps to Increase Profitability and Competitiveness

Step 1: Strategic Quality and Process Planning

Achieve greater success by understanding and managing the critical success factors

·  Link the improvement vision, goals and objectives to business success

·  Understand how improved quality and process performance increases financial performance and competitiveness

·  Identify opportunities, threats, strengths and weaknesses

·  Develop an effective improvement strategy

·  Establish coordinated system of business and improvement performance measurements

Step 2: Cost of Poor Quality Assessment

Identify and quantify the cost of nonvalue-added activities and waste caused by poor quality and inadequate business processes

·  Cost of poor quality as a performance measure and cultural change agent

·  Add a financial dimension to the quality and process improvement process

·  Determine the dollar value of effective quality and process improvement

Step 3: Cost Driver Analysis

Determine the short-term, high payback opportunities to increase profits, reduce costs and improve customer satisfaction

·  Identify the root causes of poor quality costs

·  Determine the financial impact of the root causes of poor quality

·  Conduct cost benefit analysis to identify the vital few projects

Step 4: Project Selection and Planning

Select the vital few quality and process improvement projects and develop a project plan to increase success through proper resource allocation and commitment

·  Sequence projects to increase customer satisfaction, profitability and competitiveness

·  Eliminate problems that cross functional boundaries

·  Set realistic expectations and resource requirements

·  Deploy the teams

Step 5: Monitor and Measure Progress

Ensure the right steps are taken to eliminate the root causes of poor quality and track the resulting improvements in profitability and competitiveness

·  Accelerate quality and process improvement through accurate and timely reporting

·  Report financial and non-financial achievements to top management

·  Assess progress

·  Determine the payback from quality and process improvement