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CASE OVERVIEW
Geneva Construction and Risk (GCR) is an insurance company, founded in 1922, that specializes in supplying insurance for construction projects, especially intricate projects associated with high risks. GCR became a part of their larger parent company Wichita Mutual Insurance Group, who acquired them in the year 1983. The case accounts the companys aim to adopt a Six Sigma improvement methodology. Regrettably, the companys experience with quality initiatives was poor. A few years before, Wichita Mutual had instructed all companies within its stable to adopt a total quality management (TQM) initiative. It carried out this initiative in a very authoritarian fashion, by issuing a handbook with detailed instructions of how to implement. Although the TQM initiative had never been officially pronounced a failure, it had faded over the years. In this new era, Tyko Mattson, the Six Sigma champion at GCR, is certain that an improvement initiative based on Six Sigma philosophy will be more of a success.
MAJOR ISSUE/ISSUES
The Total Quality Management Initiative (TQM) was seen a burden, rather than being part of normal business life, taking time away from normal job tasks, so eventually employees got tired of it. Middle management and supervisors never really bought or adapted well into the system, because they felt threatened and decisions were made from the top level management. Hardly any of the local subsidiaries around the world adopted the TQM philosophy, arguing that they did not want to put out the extra effort, while arguing that it was most suitable for head office processes rather than, the dynamic client base around the world.
OPTIONS
Adopt a revamped Total Quality Management approach. Commit to adopting the Six Sigma approach.
RECOMMENDATIONS 1
The option of choice we believe would be for Geneva construction and Risk to adopt the six sigma approach. This would prove to be of great use to the company as it would allow for speedier delivery of services to its customers and better decision making compared to the TQM approach that utilizes methods which originated solely from top managements judgments and decisionmaking. Top management would not necessarily be aware of the problems being faced by the employees at the lower level.
RECOMMENDATIONS 1
As a result of the structure that is input by the six sigma method this gives processes a sense of stability and customer satisfaction should be increased based on the use of the Voice of Customers
RECOMMENDATIONS 1
Because of the geographical spread of local offices it becomes tricky to engage them with any new idea. Local offices did not consistently practice TQM because they were focused on sales and support operations, and the high visibility processes that they ran were less susceptible to improvement initiatives that were designed for back-office processes. It is harder to make improvements and measure variation from a front office perspective.
RECOMMENDATIONS 2
Six Sigma places a greater emphasis on strategic objectives. Many TQM initiatives focused solely on the customer. This may not have been how TQM was seen by many of its founders, but that is the way it was frequently implemented over time. In contrast, Six Sigma looks at the needs and contribution of three basics: the customer the processes that the create the services for the customer the overall strategic objectives of the company
RECOMMENDATIONS 2
Be number one or number two in every market we compete in. Jack Welch, CEO, GE Be an industry leader by providing quality products to our customers, using the talents of our employees, and providing above average returns to our shareholders.
RECOMMENDATIONS 2
To be on top consistently, companies must constantly innovate and generate new ideas To understand how innovation best practices can be used to augment a classic Six Sigma program, it is useful to consider the methods (or tools) that are in common use to implement Six Sigma. Some of these include: Voice of the Customer, Quality Function Deployment, Root Cause Analysis, Process Mapping, Failure Mode Effects Analysis, Value Engineering Analysis, TRIZ (Theory of Inventive Problem Solving), Robust Design, Design of Experiment, and Mistake Proofing. Each of these specific methods can be better with the use of innovation best practices.