This TQM article is a continuation of the article titled: TQM Implementation Project published on 13-May-2006. This issue is part 2a of the detail article on the subject. It will deal with the "How To" part of the ANALYZE phase of the D.A.I.C. methodology described in the article. More detail sequential steps will be explained as well as the use of the appropriate tools in this ANALYZE Phase. The scope of this article will limit to Data Collection, Trench Charting and Pareto Analysis.

The ANALYZE Phase
This is a critical phase where the current state of the subject matter as well as root causes of the problem will be analyzed in detail. This analysis is done systematically and logically as follows:-

For the ease of illustration of this article, I would use one typical project as a case study. This is a Reduction of Material Loss project.

To recap from my article "TQM Implementation Project: Part 1 DEFINE Phase, example of a "Problem Statement" is described as follows:-
• Current State : Material Loss level is 5 percent against a target of 2 percent
• Impact to Organization : The extra material loss has cost the organization $200,000 per year in negative variation in profit margin
• Desire State : Material loss is reduced to 2 percent by December 2005

Given the Problem Statement, the team has to understand the extent of the loss by using a systematic approach i.e. to use the appropriate tools:-

Data collection | Trend Charting | Pareto Analysis | Fish-Bone Diagram | Why-Why Analysis

Data Collection
As the project deals with Material Loss of a production line, the team decided to understand the extent of the loss for a period of last 12 months. The team managed to collate these data from the production log sheet though manual, data are informative.

In the event data are not available, a data collection sheet needed to be designed to capture relevant data. The format of the data collection sheet will depends on the team member but it should be as simple as possible. Team leader need to assign a member to do the data collection, agree on what, where, when, who, how on data collection.

Trend Charting
With the data collected, team need to create a trend chart which is informative for the team to analysis. Simple trend chart such as a line graph, bar graph will be useful. From the trend of the material loss, team can identify whether. From the overall loss data, team need to stratify the data to understand the “make up” of this overall loss.

Pareto Analysis
From these loss components, team need to stratify them such a way that a Pareto Chart can be developed. As a Pareto Chart is a 80/20 analytical tool, team will select the top 20 percent of the components that contributes to the overall 80 percent of the loss.

My next article will continue Part 2b of this ANALYZE Phase, i.e. to deal with Fish Bone Diagram and Why-Why Analysis

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Resource Box: About the Author, LM Foong

The author holds a MBA major in TQM. He is an expert in Malcolm Baldrige Business Framework and Baldrige Assessment and TQM Implementations in manufacturing and service sector. He facilitates workshops and Cost Reduction and Productivity Improvement projects. He publishes TQM articles, ebooks, case studies, trainer manual and presentation slides available at More TQM articles or Please Visit my Web Site.

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