Best Practices for Quality Management in the Telecommunications Industry

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Best Practices for Quality Management in the
Telecommunications Industry

• ENSE627/ENPM647
• Spring 2004 Guangming Zhang
• Graciela Piedras
• Rowin Andruscavage

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Presentation Outline

• Telecom Market Overview
• Network Evolution
• What is Quality?
• Malcom Baldrige categories
• Vision for the future
• Lessons learned
• Conclusions

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Looking at the telecom past
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Then, Challenge came by

• Rapid time to market with shorter development and
  life cycles
• Very well-educated, technically excellent,
  multicultural work force

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CAGR gt50 IP VPN, VoIP, Hosting/Content, Wireless
Data
Emerging
CAGR 16 ATM/Frame, X25, Internet Broadband
Access
Data
CAGR 12
Wireless
CAGR 4
Local, Long Distance, International, Voice
Source ABN Amro, Cahners In-stat, Dittberner
, Telecom Next Strategy Group
Source Motorola, QuEST Forum
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Other Fiber optic cable, submarine optical,
non-core ancillary OSS Network systems,
Software ops, customer care, billing, support
systems
Other
OSS
Cable MSO
Wireless
Wireline
Source ABN Amro, Cahners In-stat, Aberdeen
Group, Dittberner, Telecom Next Strategy Group
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Evolution of Voice and Data

• Mobile Continues to Be the Killer Application
  We Expect 50 of 2010 Telephony Will Be Wireless
• New Technologies Add Capacity for Voice and Data
  and Differentiation Opportunities for Carriers
  for integrating networks
• Data Will Be at Least 20-25 of Mobile Industry
  Revenues by 2006 vs. an Estimate of 6 in 2002

Value of Mobile Services
2002 (Estimate)
2006 (Estimate)
Location-Based Services3
Web Services 6
Web Services 2
E-Mail and Messaging4
E-Mail and Messaging 16
Source Yankee Group
Voice 75
Voice 94
Quest Forum, Brussels December 2002
Source Motorola, QuEST Forum
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Wireless Global Cumulative Subscribers
(in millions)
Source PCS and GTSS Global Marketing
Operations
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Technology Migration Paths
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Technology Migration Paths
2.5G
CDMA TDMA GSM
3G
2G
3G
2.5G
2G
GSM 900 GSM 1800 PCS 1900
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The Benefits of Integrating IPv6
Large Address Space
Enhanced Security
The Ubiquitous Internet
Plug-and-Play
Enhanced Mobility
Enhanced Performance
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TelecommunicationsIndustry Needs

• Interoperability
• Tackle resistance to change
• Cover the areas of more potential to grow.
• To have a supportive Regulatory environment
• To offer cost-effective solutions, in
  particular, integrated services
• Differentiate the offer and the quality depending
  on the customer.
• Control the operative costs and have structures
  to maximize efficiency.
• Capacity of investiment.
• To partner with others as required.
• To offer Security, Availability, Reliability

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To be a key force in the global
telecommunications industry to improve the
quality of products for customers through the
collaborative efforts of service providers and
suppliers.
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Quality Is ...

• More than a collection of tools
• A state of mind
• Linking processes to financial results

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• European Foundation for Quality
• Management (EFQM)
• Malcom Baldrige
• Demming Price

Beam Business Excellence Model
Low
Conformance Driven
Source QuEST Forum
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ISO 9001

• Fundamentals
• Supplier quality assurance the driving motivator
• Consistency of process and reduction of variety
  as business objectives for standards.
• Documentation of work and training of employees
  as key delivery methods of consistent
  performance.
• Corrective action and problem solving as
  approach.
• Why is not enough?
• Weak on quality improvement / costs and
  customer-supplier relationships
• Customer only sees certificate no levels
• Too much supplier discretion
• No cost-based metrics / benchmarking
• Does not encourage whole-business registrations
• ISO 9000 is non-prescriptive

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What Is TL 9000?

• TL 9000 is a common set of quality system
  requirements and measurements designed
  specifically for the Telecom industry,
  encompassing ISO 9001 and other best practices
• TL 9000 Quality System Requirements
• Hardware, Software Services Best Practices
• TL 9000 Quality System Measurements
• Well-defined Comparable Measurements

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Why Baldrige?

• Systematic approach to provide an operational
  definition of the total quality approach to
  business management.
• Demonstrate superior business results over time
• Provides validated, leading-edge practices
• Defines a model for high-performing businesses
• Helps companies enhance competitiveness
• Baldrige criteria are non-prescriptive.

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A High Performance Business System
1000 Total Points
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And, Six Sigma...

• Six Sigma is a disciplined, statistically-based
  approach for improving business performance
  removing defects that occur in the products,
  processes and transactions, decreasing the cost
  of operations and goods sold, and increasing
  satisfaction of ultimate consumers.
• Six Sigma is highly prescriptive!
• Fundamentals
• Business problems require multivariate solutions
  to eliminate multiple causes and factor
  interactions.
• Cross functional problems tend to be
  multivariate.
• Customer requirements and process performance are
  the keys for defining sustained performance.

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Future of Quality?

• Future quality management systems will combine
  the best of all systems
• ISO 9001 as a lower specification limit
• Malcolm Baldrige National Quality Award criteria
  as a target for achievement and
• Six Sigma as the integrating method.

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ExampleAnatomy of the Quality Efforts and
changes of Verizon
Source Verizon, QuEST Forum
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1. Leadership Requirements...

• Involvement
• Communications
• Outcome Driven Process Focused
• Provide Stability
• Reward And Reinforcement
• Involvement
• Coach People To Make Their Own Decisions and
  Achieve Goals
• Spend 50 of Time On Top Priority Items In Full
  View Of Your Team
• Communications
• Listen
• Be Approachable And Accessible
• Broadcast the Agenda
• Encourage Debate In The Room
• Be Enthusiastic

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Best practices for leadership (1)

• Have a constancy of purpose and create a sense of
  urgency
• Use executive meetings
• Use quality methods and tools
• Visit customers
• Ensure promotion criteria reflect quality values
• Be open in surfacing problems
• Define values that are concise and well-focused
• Communicate values often using various media
• Ensure senior management demonstrates the quality
  values

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• Select benchmarking priorities according to
  critical success
• Emphasize analysis that correlates market
  position with the companys objectives, plans and
  actions.
• Connect analysis to decision making
• Focus on changing fundamental business
  capabilities
• Encourage openness and negotiation
• Conduct effective reviews

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• Develop a systematic process for managing and
  improving
• Select goals that fit the business
• Focus on few annual objectives
• Ensure that annual objectives are readily
  measurable
• Predict the impact on business results.

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Example Market Differentiation of Lucent
Quality Customer Service Excellence
Services Satisfaction (Global)
Scale 1-10
7.80
7.51
7.60
7.33
7.32
7.29
7.52
7.56
7.24
7.40
7.12
7.37
7.10
7.09
7.20
7.19
7.00
7.09
7.07
6.80
6.93
6.88
6.60
6.40
3FQ01
4FQ01
1FQ02
2FQ02
3FQ02
4FQ02
1FQ03
2FQ03
Lucent
Competitive Average
Source Lucent Customer Sat Survey
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3. Customer and market focus (1)
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Customer and market focus (2)

• Maintain continuous contact with customers and
  suppliers through data interchange.
• Emphasize key points of competitive
  differentiation.
• Continuously refine information and its
  infrastructure
• Make key information visible
• Include all stakeholders
• Benchmark companies outside the industry

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Customer and market focus (3)

• Understand what customers want
• Invest in systems and logistics to support
  customer-contact
• Empower customer-contact people
• Set standards for all aspects of customer
  interaction
• Make it easy for customers to complain and
  provide quick follow up
• Reduce uncertainty and risk

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Customer and market focus (4)

• Correlate customer satisfaction results with
  internal measures of product and service quality
• Draw comparisons with world-class leaders, not
  just direct competitors
• Use every listening post.

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Network Reliability

• The attribute that correlates HIGHEST to
  Customer Satisfaction ? RELIABILITY

Network Reliability (NO DOWNTIME)
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Managing Network Reliability

• Determine the Appropriate Measurements
  Requirements Objectives
• Establish Data Collection Systems
• Analyze Performance
• Share the Results to Bring about Awareness
• Take Steps Towards Improvement
• OSI model - different quality goals distributed
  between different levels of communications stack
• Physical layer high S/N ratio need quality
  components
• Link layer low bit error rate via encoding
• Network layer quality of service (QoS)
  guarantees
• Transport layer error detection recovery

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Examples
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4. Measurement, analysis and knowledge management
(1)

• Develop a specific set of criteria for screening
  out
• evidence that the information was built with a
  plan, rather than being something that just
  evolved over time
• Measures has to be developed for all business
  drivers and goals.
• Consistency of measures across business units.
• Include measures of cycle time and productivity
  or efficiency.

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Measurement, analysis and knowledge management (2)

• Include measures of customer satisfaction,
  process and output quality.
• Conduct research to identify correlations between
  satisfaction measures and financial performance
• Most of the time in review meetings should be
  spent analyzing results rather than simply
  reviewing them.
• Company should use data to make decisions and
  solve problems.

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Motorolas measurements

• Data is categorized as
• Performance (ex. cost of sales, on-time delivery,
  share of market,annual sales growth)
• Operational (ex. cost of quality, customer
  problem solution and view of quality)
• Metrics are shared using Motorola Compass
  Knowledge Sharing System.

Process for benchmarking other companies
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ST procedures
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5. Human resource focus

• HR Organization
• Matrixed between functional IPT leads
• Functional spheres of expertise mapped to
  processes should overlap with others
• Management Technical Proficiency
• Representation in industrial consortiums,
  conferences
• Communications tools
• Human nodes are decision makers in net centric
  operations
• e-mail, PIM collaboration, IM, other
  infrastructure

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HR Focus Matrixed Organizations

• vs. hierarchical line management
• Good for service-oriented programs
• Line / functional managers
• Integrated product team leads
• Requires much more communication!

Line Management
Sys Admin mgr Sys. Arch mgr SW Engr mgr Web mgr
Database proj lead 0.5 heads 0.5 heads 2 heads
Portal proj lead 0.5 heads 0.3 heads 2.5 heads 4 heads
Network upgrade lead 2 heads 2.5 heads
IPT Leads
http//laetusinpraesens.org/docs70s/71next/nextxb.
php
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HR Focus People Process Mapping
Customer
Product Team
Procurement
Facilities
Invoice Fulfillment
External Supplier
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HR Focus Communications Tools

• Groupware Calendaring, PIM, project/change/reque
  st/task management tracking
• Connectivity
• e-mail, IM, VTC

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Examples
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6. Process management

• Online configuration-controlled process docs
• Store and employ best practices
• Change board
• Continuous improvement
• Example Standards process (RFC, sample
  implementation, adoption, certification)
• Example CMMI continuous improvement of
  regulations, standards, deployed hardware,
  software updates

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7. Business results

• standard/proprietary format acceptance,
  adaptation, rejection
• market growth / market share
• trouble tickets, incompatibility reports
• adherence to evolution plan

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Vision for tomorrow

• Few global standards
• aligned measurements
• industry wide application
• allowing benchmarking
• capability to tailor to cover specific needs
• open
• supporting business excellence
• Future of Telcom Industry is on Services
• A services company is built on its reputation...
  Service Quality

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Top 10 Lessons learned

• 1. Leadership Commitment
• - Unshakable commitment is critical to success-
  Create a vision and values statement
• 2. Cross-functional teamwork and benefits -
  Cross-functional teamwork in tackling the white
  spaces
• 3. Consistent communications and information -
  Took great pain to explain
• - Use organizational primes to close gaps
  identified through Gap Analysis
• 4. Pride - A lot of work and a lot of fun

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Top 10 Lessons learned

• 5. Focus on what you do- Organizational
  readiness must reflect what you actually do
  otherwise everything will fall apart under
  intense scrutiny
• 6. Learning and leveraging best practices -
  Huge learning opportunity - Develop Training
  requirements and schedule
• 7. Focus on linkages - Focus on individual
  categories is not enough
• 8. Demonstrated Results - Maturity and
  performance of deployed processes MUST yield
  demonstrated results over time

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Top 10 Lessons learned

• 9. Select a total quality management model
• - Integrate strategic quality goals into the
  corporate strategic planning process, develop an
  organization structure to implement it, establish
  a design team to tailor quality process
  implementation and prepare a communications plan
  for quality.
• 10. Constructive dissatisfaction continuous
  improvement
• - The biggest and most consistent source of
  improvement is driving an ongoing constructive
  dissatisfaction of our current performance and a
  passion for continuous improvement. Benchmark
  operations against world class quality companies.

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How to ensure lasting change

• A committed unwavering and highly visible leader
• a well articulated vision, values and business
  focus
• a strategic emphasis on direction and education
• personal responsibility and accountability
• an accurate, reliable and timely measurement
  system
• effective means of communication
• a systematic way of designing, implementing and
  leading future changes
• a commitment to be persistent and flexible based
  upon what the environment dictates

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Links/references

• 2004 Baldrige National Quality Program Criteria
  for Performance Excellence http//baldrige.nist.go
  v/PDF_files/2004_Business_Criteria.pdf
• Zhang, Gunagming Quality Management in Systems,
  The Commercial Press, 1998
• Draft ITU-T Recommendation X.805 (Formerly
  X.css), Security architecture for systems
  providing end-to-end communications
  http//www.ietf.org/IESG/LIAISON/itut-sg17-ls-x805
  -end2end-communications.pdf
• QuEST Forum (http//www.questforum.com
• ATT Batting 1000 (ISBN 0-932764-23-1)
• Juran, Joseph M. Blanton, Godfrey A. Hoogstoel,
  Robert E. Schilling, Edward G., Jurans Quality
  Handbook, Fifth Edition, McGraw-Hill, 1998.
• ACATS Forum Wireless Roadmap http//roadmap.ecn.pu
  rdue.edu/CTR/documents/wireless_roadmap_final.pdf
  

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Thanks for the attention Q A