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TRANSCRIPT
January 2015
eScope The official newsle er of the ASQ Orange Empire Sec on 0701
Upcoming Events
February 10, 2014 Monthly Dinner Mee ng February 20, 2014 Seminar: Fundamentals of Data for
the Quality Analyst (Michael Sco-field)
March 10, 2014 Monthly Dinner Mee ng April 14, 2014 Monthly Dinner Mee ng April 18, 2014 Seminar: QFD
(Dr. Jack Ravelle) May 12, 2014 Monthly Dinner Mee ng
Inside this Issue Pg
Sec on Chair Update 1
Leadership Commi ee 2
New Members 3
Monthly Recer fied Members 3
The Improvement Compass—ISO 9001:2008 Required Pro-cedures?
4
Upcoming Refresher Courses 6
Boost Your Career—New Year’s Resolu on for 2015
6
Monthly Dinner Mee ng and Clinics
8-9
Radical Thinking? 10
Sec on Chair Update Happy New Year to Everyone, welcome to our January 2015 Newsle er
I hope you all had a wonderful holiday season and are ready for 2015 maybe with resolu ons. The New Year is a me to reflect on the changes we want or need to make. As ASQ Sec on 701, our new year’s resolu on is to serve you be er and we always welcome your feedback and contribu ons.
It is my pleasure to introduce you our new Membership Chair Ma Kas. Ma is an Electrical / Materials Engineer with over ten years of experience in Product Reliability and Quality of Medical Device and Automo ve Electronics and Semi-conductors. His educa on includes a MS in Materials Engineering and another MS in Electrical Engineering, both from University of Illinois. Ma Kas’ major strengths are in Product and Component Reliability and Quality Systems. He has in depth understanding of manufacturing processes, failure mechanisms and
sta s cal concepts. Ma Kas is a Cer fied Reliability Engineer by ASQ. He has volunteered as a proctor and at Orange Empire sec on booth at ASQ Quality Conference. Ma Kas has also presented Reliability related topic at Orange Empire monthly dinner mee ng. Ma likes to dance, bicycle, tennis, stand up paddle board, sail and motorcycle in his spare me.
Do you consider yourself a “Social Media Guru”? We are looking for an expert, a social media innova-tor to be the “Social Media Chair” of our ASQ Sec on 701 and would work in close alignment with all of other ASQ Sec on 701 Chairs. The role and responsibility would be to develop a robust Twi er, Linked In, and maybe even a Facebook presence for our Sec on. If you are interested, please contact our Sec-
on Vice Chair Dieter Eckstein at [email protected].
Best Wishes,
Anet Tanya Ant, CQE, CQA
Chair
ASQ Orange Empire Sec on 701
Anet Tanya Ant, CQA, CQE Chair - ASQ Orange Empire Sec on 0701
Page 2
eScope January 2015
CAREER MANAGEMENT CHAIR
Bob Mehta
TEL (949) 510-9138
INTERNET CHAIR
Jay Mehta
TEL (949) 887-0577
MEMBERSHIP CHAIR
Ma Kas
TEL (480) 385-9928
AUDITING CHAIR
Aaron Reddoch
NOMINATING CHAIR
Dave Nagy
TEL (714) 883-9305
VOC CHAIR
Stan Themea
TEL (909) 714-4323
SECTION 7 REGIONAL DIRECTOR
Ed Ma hews (2014)
TEL (714) 686-6638
ed.ma [email protected]
SECTION 7
DEPUTY REGIONAL DIRECTOR
Vinay Goyal
TEL (714) 876-3927
CHAIR
Anet Ant
TEL (949) 903-3274
VICE CHAIR
Dieter Eckstein
TEL 949 677-2751
TREASURER
Briana Sallows
TEL (909) 910-8933
SECRETARY/HISTORIAN
Open
EDUCATION CHAIR
Mark Lindsey
TEL (714) 273-2678
CERTIFICATIONS/ RENEWALS
Cory Goral
TEL (949) 753-6333
CHIEF PROCTOR
Hassan Farah
TEL (909) 261-3517
PROGRAMS CHAIR
Dave Nagy
TEL (714) 883-9305
ARRANGEMENTS
Vatsal Patel
eSCOPE EDITOR
Open
2015 Leadership Team
We are looking for difference makers!
Join our ASQ Team of Volunteers and help us con nue to make the ASQ Orange Empire Sec on 0701 one of the best! We are cur-rently looking for volunteers for the follow-ing:
Programs and Dinner Mee ngs Logis cs
Historical (Catalog/Sort historical docu-ments, create visual compila ons & presenta ons of our sec on’s history, document current events, etc.)
Clinic and dinner speakers
For more informa on contact Dieter Eckstein @ Tel. 949 677-2751 or email at
Page 3 eScope January 2015
Congratula ons! Cer fica ons
The following members have met the requirements to be recer fied
Are your certifications due for renewal?
You can submit up to six months before and after the due date. The recertification units must fall within the
recertification period.
Send you recertification packages to:
Alcon Laboratories
A n: Cory Goral, M/C 122, CEE Lab
15800 Alton Parkway, Irvine, CA 92618
For more informa on email [email protected] or
Click here for more informa on
Basim Gergis
Blake Nadolny
Christopher Karner
Cyndee Hudak
Elizabeth Matheny
Greg Godfrey
James Eyster
Ken Seider
Liliane Phan
Minh Do
Nora Dowell
Phillip Cain
Raul Rovirosa
eScope Ad Rates
Ad Size Approx. Inch Size
1 Issue 6 Issues 12 Issues
Full page 8.5” x 11” $200 $1,100 $2,000
1/2 Page 7.5” x 4.91” $110 $605 $1,100
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Checks should be made to: ASQ Orange Empire Section, and mailed to ASQ, PO Box 14183, Irvine, CA 92614, with ad copy,
instructions for placement, and frequency. SCOPE Editor: Dieter Eckstein 949-677-2751 or
email [email protected]
Welcome! New ASQ Members
Welcome and congratula ons on making the important deci-sion to become a member of ASQ.
All new members are eligible for free admission to a dinner mee ng within 3 months of becoming a member. Please con-
tact Ma Kas for a free dinner voucher at Ma [email protected]
Craig A. White
Cynthia Abdallah
Dwayne Cote
Farzam Afshar
Gemini O. Majkowski
Greg Pritche
Hassan M. Farah
Joaquin Kurz
Joel Pan g
John Terefenko
Melanie Griffin
Olivia Chan
Paul Aquino
Richard Gorham
Rod Bowden
Rogelio Valdez
Ronnie Sanchez
Shepard G. Bentley
Vida Sadeghi
Zhiwei He
Page 4 eScope January 2015
The Improvement Compass Finding direc on!
ISO 9001:2008 Required Procedures? By Dieter Eckstein, ASQ CMQ/OE, CQA, BSBM
O en the ques on comes up during an audit whether a pro-cedure should be documented or not. It makes for an inter-es ng conversa on when the auditee is dispu ng the fact that according to ISO 9001, “ONLY” six documented proce-dures are “required.”
4.2.3 Control of documents
4.2.4 Control of records
8.2.2 Internal audit
8.3 Control of nonconforming product
8.5.2 Correc ve ac on
8.5.3 Preven ve ac on
This person was obviously paying a en on during the last ISO training or I wonder if he just googled the ques on before having the conversa on?
One of my auditors engaged this invigora ng conversa on during his last assignment which I observed as part of the auditor qualifica on process and when the excitement of the conversa on reached mutual frustra on, I asked for a small break to have a conversa on with my auditor.
On the way to my office, the auditor kept telling me how wrong the other person was. He knew that the ISO 9001 standard has provisions that may require procedures beyond the six clearly required documented procedures!!
When we got to my office, I tried to have a conversa on with my auditor about the importance to not engage in these type of disputes, even when he is right. I had to re-direct his think-ing to understand that he doesn’t need to dispute the re-quirements with an auditee. If the process he was audi ng is not one of the six required documented procedures, his job as an auditor is to find out whether the process is effec vely planned, implemented and controlled without a documented procedure. If the process being audited proves to be effec ve in these three requirements without a documented proce-dure, there isn’t much of a case to say that a documented procedure is required.
However, if during the audit the auditor is able to find objec-ve evidence that proves the process to be deficient and the
objec ve evidence can be linked to the lack of a documented procedure as one of the poten al causes, the value added of a documented procedure can be argued with “facts.”
How can one check if a documented procedure is needed?
1. Is the process reliability based on tribal knowledge that
could be lost if given employees leave the organiza on?
2. Is it clearly understood and defined what are the process pa-rameters, needs, roles and responsibili es of those involved to achieve the desired results?
3. Is there a consistency among employees for the method and tooling u lized?
4. If equipment is used, is there controls to make sure calibra-on is required where applicable? How is down me pre-
vented?
5. From a Social Responsibility angle, is the employee culture such that prevents pollu on and/or employee illness or inju-ry?
6. Does training exist for new or temporary employees that work in this process to achieve the desired results?
7. Are the necessary records consistently generated to provide evidence of an effec ve process?
The list can go on, but these are typically seven areas where most processes tend to fail because communica on and compliance without a documented procedure tends to deteriorate with me.
In companies where certain processes are not part of their every-day opera ons, documenta on tends to be the most effec ve way to ensure repeatable and reliable results. Employees are more likely to pull the procedure to review the requirements prior to performing the work.
At the opposite end of the spectrum, companies where employ-ees work on a process con nuously, several cycle mes through-out the day, it is almost certain that these employees WILL NOT go to the procedure to make sure they follow the correct steps and meet all requirements. These are companies that rely on their training to establish competence, repeatable and reliable results.
Although, it was rewarding to see that my auditor had a clear un-derstanding of the ISO 9001 requirements on documenta on, it was even more rewarding to go on this path that delivered a good lesson to all involved. It is important to know the ISO 9001 re-quirements, but understanding the intent for effec veness is where the value is found.
Documented procedures are tools that help define processes. They are not necessarily the only means to establish processes that have reliable and repeatable outcomes. From the perspec-
ve of the ISO 9001 requirements, beyond the six required docu-mented procedures, we have to establish if a documented proce-dure is necessary by determining how the absence of a docu-mented procedure can lead to a deficient process which fails to deliver “repeatable and reliable” outcomes that meet the organi-za on’s targets and/or objec ves.
Page 6 eScope January 2015
Cer fied Manager of Quality & Organiza onal Excellence Course
& Exam Prep
SESSIONS/DATES 9 sessions; Mondays from January 12, 2015 to March 2, 2015 with 1
session TBA.
Will cover: Leadership, Strategy Development & Deployment, Quali-ty Management Tools, Customer Focused Organiza ons, Supplier
Performance, Management, & Training/Development. Plus, strate-gies/ ps for preparing & taking the exam.
When January 12, 2015 6:00 PM - March 2, 2015 9:00 PM
Loca on Alcon Laboratories
15800 Alton Parkway, Irvine, California 92618 USA
Dress Code Business A re
CLICK HERE TO REGISTER
Cer fied Quality Inspector /Quality Technician Refresher Course
SESSIONS/DATES 9 sessions total. Mondays January 12, 2015 - March 2, 2015. 1 ses-
sion TBA
Will cover: Inspec on & Test techniques and Methods, Metrology, Calibra on, GD&T, Basic Sta s cs, Sta s cal Process Control, Capa-bility Analysis, Acceptance Sampling, etc. Also covers strategies/ ps
for preparing & taking the exam
When January 12, 2015 6:00 PM - March 2, 2015 9:00 PM
Loca on Alcon Labs
15800 Alton Parkway, Irvine, California 92618 USA
Dress Code Business A re
CLICK HERE TO REGISTER
Boost Your Career—New Year’s Resolu on for 2015 By Mark Lindsey – ASQ0701 Educa on Chair
Only 47% of our Sec on Members currently possess an ASQ cer fica on. 2015 New Year’s Resolu on – Earn an ASQ Cer -fica on and/or encourage another to pursue one.
Last December was a busy month for many of you who tackled various ASQ Cer fica on Exams (132 members) followed by our Casino Night (> 100 members and guests) in addi on to you spending me with family and friends over the holidays.
As part of the year end ac vi es I did some data mining with ASQ Na onal regarding our sec on members who have cer fi-ca ons. Below are some metrics they shared with us (my com-ments are the sub bullets).
Number of members within the Orange Empire sec on (0701) = 1,294.
Number of members within the Orange Empire sec on (0701) who currently hold a cer fica on of any kind = 618.
47 % (618) of our members currently hold a cer fica on.
53 % (676) of our members do not hold any cer fica on. Why? What are the constraints considering those who are cer fied earn more and contribute more?
Total number of cer fica ons held by members of the Orange Empire sec on (0701) = 1,165
1,165 cer fica ons/618 cer fied members = Average of 1.9 cer fica ons held by each cer fied member. Great!
Thus, approximately half of our members currently possess an average of 2 cer fica ons each and the other half of our mem-bers possesses no cer fica ons.
We applaud our members who have earned cer fica ons and need you to inspire others to do the same. For 2015, we would like to encourage all of our members to do at least one of the below as part of their New Year’s Resolu ons to improve our Southern California.
Earn a cer fica on if you currently do not possess one. Enroll in one of our Refresher Courses to assist you. We should have more than 50% of our members cer fied.
Earn a second cer fica on if you only possess one. Quite a few possess 3+ cer fica ons which is why the average is 1.9 per cer fied member. As Stephen Covey said “the 7th Habit of Highly Successful People is to Sharpen the Saw”.
Encourage others (i.e. coworkers, suppliers, customers) to pur-sue a cer fica on. It takes a village. Help create a synergy as part of your legacy in leading organiza on excellence (part of the CMQ-OE BoK).
Con nued in page 7
Page 7 eScope January 2015
Con nued from page 6…
Par cipate in our other programs (i.e. Clinics, Dinner Mee ngs, Seminars), network, and apply your refined skills to make a differ-ence. These will serve as RUs (Recer fica on Units) for your cer fica ons.
Your Leadership Council is available to assist you in this. Reach out to us so we can help you over-come any constraints and achieve excellence. For now, below are some links:
For informa on on our Sec on Refresher Courses and exam dates go to h p://asqorangeempire.org/?page_id=27
To register for the courses go to h p://asqorangeempire.org which are posted on our web site approximately 1 month before the class starts. For those who are unemployed will receive a 50% discount on the course. These courses also provide great networking opportuni es.
Below is link and the ar cle that ASQ Na onal emailed to all of the members recently.
h p://links.communica ons.asq.org/servlet/MailView?
January February March April May
Dinner Mee ng Jan. 13th Feb. 10th Mar. 10th April 14 May 12
Clinic 1 Essen al Deming -
Deming for Managers (Dr. Phil Rosenkrantz)
Deming's System of Profound Knowledge (Dr. Milt Krivokuca)
TBD SIPOC
(Dr. Jack Ravelle)
Clinic 2
Capturing Process Measurements, and Structuring Them in
Data Files (Michael Scofield)
Failure Mode and Effects Analysis
(Chhanubhai (C.G.) Mistry)
TBD
Dinner Presenta on
Travel Smart with these Must-Have
Prac ces for Global Growth
(Nick Vyas)
FOD (Mike A. Perez)
Voice of the customer and Kano model
Special Announcements
2/20/15 Seminar: Fundamen-
tals of Data for the Quality Analyst
(Michael Scofield)
4/18/15
Seminar: QFD (Dr. Jack Ravelle)
Educa on
CQI CQE CQA
CQT CSSGB CCT
CQM-OE
CQA-Bio
REFRESHER COURSES
PROGRAMS FOR 2015
Page 8 eScope January 2015
ASQ Orange Empire Monthly Dinner Mee ng
This is our regular monthly dinner mee ng program with two clinics running concurrently, dinner, and an outstanding a er dinner presenta on. You are welcome to come for the clinics and a er dinner presenta on WITHOUT buying the dinner. In fact, we welcome you. We will have accommoda ons for you.
This way you s ll earn the RU and take advantage of the presen-ta ons.
PRESENTATIONS
Clinic 1: Essen al Deming - Part 1 Presented by Dr. Phil Rosenkrantz
Clinic 2: Leveraging Quality Tools Throughout the Organiza on
Presented by Akhilesh Gula
Dinner Presenta on: Global Manufacturing: Cost, Quality, and Percep on
Presented by J.Gregory Renfro. P.E.
WHEN Tuesday, January 13, 2015 5:15 PM - 9:00 PM Pacific Time
WHERE Doubletree Hotel Santa Ana/Orange County Airport
201 East MacArthur Boulevard, Santa Ana, California 92707 USA
FEES Clinic 1 or Clinic 2 ONLY (no dinner speaker or meal)
(0701 Member) Complimentary (Non-0701 Member) $10.00
Clinic 1 or Clinic 2 and Dinner Speaker (no dinner meal) (0701 Member) Complimentary
(Non-0701 Member) $10.00
Full Package - Clinic 1 or Clinic 2, Dinner, and Dinner Speaker (0701 Member) $30.00 for a limited me ($40.00 original price)
(Non-0701 Member) $45.00 for a limited me ($55.00 original price)
RSVP by Friday, January 13 at 11:15 AM for discounted pricing and Fish
and Beef dinner selec ons.
CLICK HERE TO REGISTER
DINNER PRESENTATION
Global Manufacturing Costs, Quality, and Percep ons
Presented by: J. Gregory Renfro, P.E
Dinner Presenta on: Global Manufacturing Costs, Quality, and Percep ons
For Na onal Oilwell Varco, it isn’t a ques on of whether or not to manufacture outside the US, it is a ques on of how to do it in a controlled manner. More than 70% of our products are consumed interna onally and in many cases, our customers are, in-turn, providing their services to “State” run oil companies. These down-stream customers will o en require percentages of their equip-ment to be produced within their jurisdic on. In some cases, our equipment is too large to be transported and must therefore be produced at the dockside so it can be loaded directly onto the end user’s vessel. By a ending this clinic presenta on, you will get an insider’s per-spec ve of the decision making process and the considera ons for managing cost, quality and percep ons in the global supply chain.
About our speaker: J. Gregory Renfro, P.E
J.Gregory Renfro is the Vice President - Global Manufacturing Strategy, Rig Solu ons at Na onal Oilwell Varco (NYSE: NOV). He is responsible for se ng the manufacturing strategy and enhancing the produc on capability of the Rig Solu ons Group within Na on-al Oilwell Varco. He has 36 years of experience in the design, de-velopment and produc on of oilfield equipment worldwide. He is a registered Professional Engineer and holds three U.S Patents on the design of machinery.
J.Gregory Renfro is on the Execu ve Advisory Board for the QRM Center for Quick Response Manufacturing at University of Wiscon-sin-Madison and associated with mul ple professional associa-
ons including IADC, API, SPE, ASME, NSPE. He holds a BSME de-gree from the University of New Mexico.
CLINIC # 1
The Teachings of Dr. W. Edwards Deming: A Three‐Part Series
Presented by: Dr. Phil Rosenkrantz
Part 1 of 3: Essen al Deming
Dr. W. Edwards Deming (1900-1993) was probably the most profound quality guru of the 20th Century. His ideas were first published in his monumental book: Out of the Crisis (1986). Boldly stated--it is difficult to understand the modern quality movement without some in-depth un-derstanding of Dr. Deming’s teachings. Deming is well known for his teachings that challenged American management and led the country of Japan into the modern manufacturing era and significant prosperity. Deming taught that everyone--especially top management--should strive to learn about the systems they work with and con nuously work on improving them. This presenta on will not only provide context for what Dr. Deming taught, but will bring the audience up to date on some mod-ern views of Deming’s teachings. While there are new theories that have come along in the 20 years since Dr. Deming passed, his teachings are essen al for understanding modern quality. Series Schedule:
Part #1-January 13: Essen al Deming - Overview of Dr. Deming's life, significance, major theories and essen al concepts. Presented by Dr. Phil Rosenkrantz Part #2-February 10: Deming for Managers - Deming's Fourteen Points for Management, Seven Deadly Diseases, and Assignable vs. Common Cause varia on. Presented by Dr. Phil Rosenkrantz Part #3- March 10: Deming's System of Profound Knowledge – This is the capstone presenta on because it incorporates all of Deming's teachings in various ways. Presented by Dr. Milt Krivokuca.
About our speaker: Dr. Phil Rosenkrantz
Dr. Phil Rosenkrantz is Professor Emeritus of Industrial & Manufacturing Engineering at Cal Poly Pomona where he has been teaching and con-sul ng for 32 years and served as Department Chair from 1990-1997. Founding Coordinator of the MSQA Program at CSU Dominguez Hills from 1986-1989. Industrial engineering supervisor for General Motors prior to entering academia. Educa on: Doctor of Educa on in Organiza-
onal Leadership, Pepperdine University; MS in Sta s cs, UC Riverside; MS in Industrial Administra on, Purdue University; and B.S. in Mechani-cal Engineering, Ke ering University (formerly GMI). P.E. (California). 2005 Recipient of the Simon Collier Award. Dis nguished Engineering Educator, Los Angeles Council of Engineers & Scien sts, 2009. George P. Hart Award for Outstanding Faculty Leadership 1999. Outstanding Teacher Award for the College of Engineering 2012. Phil has been ac ve in ASQ and ASEE (American Society for Engineering Educa on). mes Wabby is the Director of Quality Compliance and Risk Management at Allergan Inc. in Irvine, California.
CLINIC # 2
Leveraging Quality Tools Throughout
the Organiza on
Presented by: Akhilesh Gula
The session will present examples of use of quality tools outside of the norm that most of us quality professionals might be used to. Most of those who employ this problem-solving tools have done so mainly on quality improvement projects. Limi ng to just these areas or types of ini a ves results in huge opportuni es being missed to have an even greater impact on their organiza ons as well as expanding their own skill set.
For example, DOE and Process Modeling methodologies have been successfully u lized in quality, engineering and manufacturing over the last half a century to op mize products and process de-signs. With li le effort organiza ons can now benefit from these proven techniques to economically op mize their marke ng returns (design and layout of literature, texts, web site, adver sing mix, etc) by following a structured and data-driven approach.
In this presenta on, Akhilesh hopes to encourage organiza ons to leverage the skills of their Six Sigma Black Belts for more than solv-ing quality problems..
Our speaker: Akhilesh Gula – Six Sigma Master Black Belt And Lean Leader
Most of ASQ-OC members are probably familiar with Akhilesh as we have been publishing his 'Radical Thinking?' ar cles in the Scope for many years. He has also done presenta ons at this Sec on over the past several years. Akhilesh Gula has 20 years of experience in opera ons and process improvement, design, lean, Six Sigma, stra-tegic planning, and TRIZ (structured innova on) training and con-sul ng. Gula is the principal consultant at PIVOT Management Consultants in Upland, California. He holds a Masters in Naval Archi-tecture and Marine Engineering from the University of Michigan, Ann Arbor, and an MBA from UCLA. Today he will be sharing exam-ples of using DOE etc. in non-tradi onal areas.
Gula @pivotmc.com; mobile: 909-518-0807; US Ph: 909-985-9294
Read his ar cles at:
h p://www.qualitydigest.com/search/node/Akhilesh%20Gula
Page 9 eScope January 2015
Page 10 eScope January 2015
Radical Thinking? Leveraging Quality Tools Through‐out the Organiza on
DOE in Marke ng & Adver sing
By Akhilesh Gula
DOE (Design of Experiments) is a term familiar to most quality professionals. Some use it on a regular basis; others try their best to avoid it. Most of those who employ this problem-solving tool have done so mainly on quality improvement projects. Lim-i ng to just these areas or types of ini a ves results in huge op-portuni es being missed to have an even greater impact on their organiza ons as well as expanding their own skill set.
Organiza ons spend a fair amount of labor and financial re-sources on adver sing in the form of its ming, media usage, channel selec on, etc. The assump ons that go into the ra-
onale for many of these marke ng/adver sing decisions can be costly and reduce their effec veness significantly. Why not apply this experiment-based methodology to understand these rela-
onships? It would illuminate not only their complexity and counter-intui veness but also help determine the impact adver-
sing, its ming, product pricing etc. might have on sales.
Joe said that his VP of Marke ng approached him with a request to increase the marke ng budget to include addi onal adver s-ing in twelve marke ng areas. As usual he defended his proposal on the basis of a projected increase in sales that he believed it would produce. This is something that came up annually during the budge ng process. However, this year Joe wanted to find out whether the organiza on received the value proposed by the increased budget – essen ally determining if there was an ROI for the addi onal expense. This analysis could benefit from a DOE perspec ve and would be a great opportunity for one of his Six Sigma Black Belts to apply this tool in a “non-quality” ini a-
ve.
Wan ng to keep it simple, 50% of the requested increase in the adver sing budget was approved with the following caveat. Joe, VPE of Marke ng, and a Black Belt would collaborate in selec ng six of the twelve areas to receive addi onal adver sing and the remaining six areas, with no addi onal adver sing, would be used as the control group. Marke ng had already created a fore-cast of monthly sales in each of the marke ng areas and the in-tent was to measure the increase in the predicted forecast. Us-ing sta s cal characteris cs of the forecasts, they es mated that they had a 95% chance of increasing sales by 4% with addi onal adver sing in those six markets.
A er addi onal adver sing in the six areas was deployed and six
months of data collected, analysis failed to reveal any signifi-cant difference between the test and control areas. Although there was a minor increase in sales over the forecast, the increased amount of adver sing did not jus fy the increased amount in sales. Under the past assump ons, without the sta s cal analysis, the observed increase in sales would have been a ributed to the addi onal adver sing.
This finding, however, encouraged Joe and his Execu ve Team to take a second step and try to determine the proper amount to spend on adver sing. They wanted to proceed with cau on, however, since they believed that much of their success was due to the quality of their product and the effec-
veness of how they communicated this through their adver-sing. They decided to conduct an experiment in fi een mar-
ket areas – areas where they had been trying to make addi-onal inroads. Their primary goal was to measure the impact
of adver sing on sales – not on tradi onal measures such a recall rate or a tude toward their product. This would allow them to also understand the causal (not merely the correla-
on) connec on of adver sing on purchases (sales). Correla-on could be misleading and become self-serving; historical
increases in adver sing were based on forecasts of increased sales and not the other way around!!
They agreed on three treatment levels (a 25% decrease, no change and a 50% increase in adver sing budget). Since ad-ver sing alone does not determine sales, other important factors considered were point of sales and sales effort. Price was held constant. This led to a designed experiment, with three factors and three levels, conducted over a period of one year. The results did not agree with the ingrained expecta-
ons of the organiza on. In addi on it did not reveal any interac ons between the three factors. However, it did make the organiza on recep ve to the use of Design of Experi-ments outside of ‘quality’.
Previously, as part of on ongoing marke ng effort, the organi-za on mailed out discount coupons of various amounts to be redeemed at specific retail stores; discounts ranged from 2 - 40%. The goal was to achieve at least a 10% response rate from the mailings. As the Marke ng Department became more comfortable with the use of quality tools, they began to proac vely call upon the Black Belt to help. In this case they wanted to determine the percent discount that should be offered to achieve >10% return response rate.
By using historical data and Process Modeling tools, the Black Belt was able to understand the rela onship between dis-count percentages and customer response. Regression analy-sis indicated a fairly strong non-linear rela onship.
While a strong correla on was good, the original ques on s ll remained unanswered: What discount rate will generate a minimum 10% coupon redemp on by the customers? Ongo-
Page 11 eScope January 2015
ing process modeling ac vity and analysis was performed to come up with the following results: with 95% confidence level, a discount coupon of 18% should create at least a 10% response from the mailing and could generate as much as a 20% redemp-
on. This made the discount coupon process more predictable for budget planning purposes where ROI could be predicted and measured.
Although these were rather simple applica ons of quality tools to marke ng, it allowed the organiza on to use the DOE methodol-ogy and other quality tools in non-tradi onal ways: op mizing its marke ng mix, se ng discount coupon levels, forecas ng cus-tomer preferences, determining effect of price on sales, design-ing marke ng brochures to influence conversion rates, etc.
DOE and Process Modeling methodologies have been successfully u lized in quality, engineering and manufacturing over the last half a century to op mize products and process designs. With li le effort organiza ons can now benefit from these proven techniques to economically op mize their marke ng returns (design and layout of literature, texts, web site, adver sing mix, etc.) by following a structured and data-driven approach.
Leverage the skills of Six Sigma Black Belts (internal and/or exter-nal) for more than solving quality problems.
About Akhilesh Gula :
Principal of Pivot Management Consultants— He has 16 years of experience in team leader-ship, and coordina on, problem solving, lean manufacturing and kaizen events, process and produc vity improvement. Experienced in a wide variety of industries: ship building, oil and gas, aerospace, insurance, healthcare, distribu on, hi-tech and manufacturing. MBA, MS, BS, California Quality Award Examiner, Senior Member ASQ, Past Chair (1993-1994)ASQ Sec on 0702, Founding member Inland Empire Council for Excellence (S. California). Experienced trainer.