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Best Practices for Quality Management in the Telecommunications Industry

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Title: Best Practices for Quality Management in the Telecommunications Industry


1
Best Practices for Quality Management in the
Telecommunications Industry
  • ENSE627/ENPM647
  • Spring 2004 Guangming Zhang
  • Graciela Piedras
  • Rowin Andruscavage

2
Presentation Outline
  • Telecom Market Overview
  • Network Evolution
  • What is Quality?
  • Malcom Baldrige categories
  • Vision for the future
  • Lessons learned
  • Conclusions

3
Looking at the telecom past
The business climate used to be like a ship on
a calm sea.
4
Then, Challenge came by
  • Rapid time to market with shorter development and
    life cycles
  • Very well-educated, technically excellent,
    multicultural work force
  • A growing body of de facto global standards
  • A customer base that may have little or no
    experience with the product or technology
  • A marketplace that is willing to accept
    innovative solutions to problems they may not yet
    know they have
  • New Competitors CLEC, ISP, ASP
  • New Technology Solutions VoIP, MPLS, QoS but
    you need backwards compatibility w/ legacy
    systems
  • Blind Faith in the Stock Market
  • Unrestrained Spending
  • Globalization (Mergers and Acquisitions) so
    highly competitive

5
Worldwide Communications Services Revenue
Steady Growth in Voice Revenues, Volume MOU
Offset by Price Compression, Increase in
Advanced Data/IP Revenues
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
6
Return of Steady Telecom Growth
Overall Steady Growth, Increased OSS Importance,
Within Segment Dynamics Define Growth
Opportunities
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
7
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
8
Wireless Global Cumulative Subscribers
(in millions)
Source PCS and GTSS Global Marketing
Operations
9
Technology Migration Paths
2.5G
CDMA TDMA GSM
3G
2G
3G
2.5G
2G
GSM 900 GSM 1800 PCS 1900
10
The Benefits of Integrating IPv6
Large Address Space
Enhanced Security
The Ubiquitous Internet
Plug-and-Play
Enhanced Mobility
Enhanced Performance
11
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

12
  • 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.

quality
collaboration
13
Quality Is ...
  • More than a collection of tools
  • A state of mind
  • Linking processes to financial results

You dont have to do this, survival is not
compulsory. W. Edwards Deming
14
How to compare quality models?
Industry Synergy
Benchmarking
Best Practice
Certification
BEM BEAM Guidance
  • European Foundation for Quality
  • Management (EFQM)
  • Malcom Baldrige
  • Demming Price

Beam Business Excellence Model
Low
Conformance Driven
Source QuEST Forum
15
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

16
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

17
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.

18
A High Performance Business System
1000 Total Points
19
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.

20
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.

21
ExampleAnatomy of the Quality Efforts and
changes of Verizon
Source Verizon, QuEST Forum
22
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

23
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

24
Best practices for leadership (2)
  • Define management roles and responsibilities for
    quality
  • Reward management behavior as well as results
  • Promote cross-functional cooperation
  • Conduct annual quality planning at every
    management level
  • Measure employees perceptions of the gap between
    espoused values and real values

25
2. Strategic Planning
  • 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

26
2. Strategic Planning
  • 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.

27
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
28
3. Customer and market focus (1)
  • Quality Improvements
  • Cost Improvements
  • Data Security
  • Confidentiality of Data Source (Submitter)
  • Confidentiality of Data
  • Security of Data
  • Integrity of Data
  • Reliability of Data
  • Availability of Processed Data (in report form)
  • Uniform Measures / Standards

29
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

30
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

31
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.

32
Network Reliability
  • The attribute that correlates HIGHEST to
    Customer Satisfaction ? RELIABILITY
  • Higher Customer Sat
  • Lower Churn
  • Higher Sales

Network Reliability (NO DOWNTIME)
33
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

34
Examples
35
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.

36
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.

37
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
38
ST procedures
  • Indicators are selected by time sensitivity
  • There is only one source of data to avoid errors.
  • The built-in improvement cycle ensures that the
    data, and use of information are continuously
    updated to meet users needs.
  • They hold periodic operating review meetings to
    draw plans for improvement using
    Plan-Do-Check-Act.

39
5. Human resource focus
  • HR Organization
  • Matrixed between functional IPT leads
  • Functional spheres of expertise mapped to
    processes should overlap with others
  • Communications tools
  • Human nodes are decision makers in net centric
    operations
  • e-mail, PIM collaboration, IM, other
    infrastructure
  • Management Technical Proficiency
  • Representation in industrial consortiums,
    conferences

40
Examples
41
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

42
7. Business results
  • standard/proprietary format acceptance,
    adaptation, rejection
  • market growth / market share
  • trouble tickets, incompatibility reports
  • adherence to evolution plan

43
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

44
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

45
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

46
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.

47
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

48
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.

49
Thanks for the attention Q A
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