Using the TQM Umbrella to Implement Business Process Reengineering (1996)

Using the TQM Umbrella to Implement Business Process Reengineering Robert N. Flatt Robert N. Flatt Cooper Cameron Corporation, Cameron Division Search for other works by this author on: This Site Google Scholar Paper presented at the International Petroleum Conference and Exhibition of Mexico, Villahermosa, Mexico, March 1996. Paper Number: SPE-35301-MS https://doi.org/10.2118/35301-MS Published: March 05 1996 Cite View This Citation Add to Citation Manager Share Icon Share Twitter LinkedIn Get Permissions Search Site Citation Flatt, Robert N. "Using the TQM Umbrella to Implement Business Process Reengineering." Paper presented at the International Petroleum Conference and Exhibition of Mexico, Villahermosa, Mexico, March 1996. doi: https://doi.org/10.2118/35301-MS Download citation file: Ris (Zotero) Reference Manager EasyBib Bookends Mendeley Papers EndNote RefWorks BibTex Search nav search search input Search input auto suggest search filter All ContentAll ProceedingsSociety of Petroleum Engineers (SPE)SPE International Oil Conference and Exhibition in Mexico Search Advanced Search AbstractThis paper analyzes the keys to successful implementation of a Total Quality Management (TQM) effort in a major oil service company over a 13-year period. A formal Quality Improvement Process began in 1982 with an initial focus upon error cause removal, employee involvement, and cross-functional corrective action teams. During the 1980's the program targeted manufacturing processes: statistical process control, just-in-time manufacturing, process capability studies, vendor partnering, and industry QA standards such as ISO 9000. Cost of quality plummeted from over 30% of sales to less than 5% during this period. In 1993 all change efforts were brought under the TQM umbrella and the focus shifted to reengineering the key business processes of the company. This paper will describe in detail how the TQM program evolved from a softer, quality awareness, people involvement process to a very results driven, radical change effort focused upon reengineering the activities, processes and structures of our businesses to reduce cycle times of all business processes, reduce costs, and improve quality and customer satisfaction. We will discuss the change imperative facing our industry and the basic concepts and principles of Business Process Reengineering and Supply Chain Cost Management. This will include a discussion of the benefits of customer/vendor alliances and partnerships and how to eliminate non-value-added activities throughout the supply chain to radically decrease cost and cycle time and improve quality. We will look specifically at two major reengineering efforts underway to dramatically improve the performance of the order fulfillment process and the goods acquisition process. We will conclude that the key to quality improvement and cost reduction in the Age of Systems of the 1990's is to simplify business processes and reduce cycle time. This paper will describe how to use the TQM umbrella to effect this change.IntroductionAs Russell Ackoff predicted in the early 1970's, we are in the middle of a "Second Industrial Revolution" which will change our lives as we enter the 21st century even more dramatically than the first one at the turn of this century. We are now living in the Information Age - or Systems Age - which will require the application of systems thinking to the way we organize work. We are moving from a paradigm of reductionism or fragmentation, in which problems or work processes are broken down into their smallest components and each component is analyzed and optimized, to a paradigm of systems thinking in which problems or work processes are viewed holistically and the whole is optimized - not the fragments. This journey has resulted in a plethora of change management concepts and panaceas which have been rolled out by consultants and authors - Quality Improvement Process, Total Quality Management, Downsizing, Right Sizing, Empowerment, Business Process Reengineering, Supply Chain Cost Management, and now the latest from Harvard, "Creative Destruction."All successful change efforts using any of these labels focus on eliminating non-value-added activities, both constant and radical process improvement, and integrated, flattened structures enabled by the information technology explosion of the 1990's. Change is successful when a significant percentage of the work force no longer just does the work of the company, but as James Champy says "works on the work" to reconfigure the work to make it "better, faster and cheaper." Also, "better, faster and cheaper" are not naturally exclusive but rather feed on each other. The key is reducing cycle time which reduces costs and improves quality. This is the link from Business Process Reengineering back to Total Quality Management where many companies began their change efforts in the early 1980's. The faster one performs a process or makes a product, the lower the total cost becomes, and the quality always improves - oftentimes significantly.As processes become seamless, where working people hand off directly to other working people throughout the supply chain, each learning about defectives or potential defectives from the previous operation in real time at the source, the organization becomes the learning, flexible, adaptable organism described by Peter Senge and quality improves. Total Quality Management then can be used as an umbrella under which to describe and discuss value - delivering the best value possible to customers, employees, shareholders, and ultimately to our communities.P. 99 Keywords: operation, tqm, bpr, defect, real time, upstream oil & gas, customer, supply chain, quafity improvement, quality management This content is only available via PDF. 1996. Society of Petroleum Engineers You can access this article if you purchase or spend a download.