whitepaper - zero defects€¦ · zero defects are possible 1. the problem 3 1.1. spectrum of...

WHITEPAPER ZERO DEFECTS ARE POSSIBLE

2018-09-18

WHITEPAPER

ZERO DEFECTS ARE POSSIBLE

1. THE PROBLEM 3

1.1. SPECTRUM OF DEFECTS 3

1.2 PRODUCT RECALLS 3

1.3 CAUSES AND EFFECTS 5

2. THE SOLUTION 5

2.1 DEVELOPMENT OF DEFECTS 6

2.2 PREVENT KNOWN DEFECTS 6

2.3 IDENTIFY UNKNOWN DEFECTS 6

2.4 HOW CAN THIS BE ACHIEVED 7

3. THE IMPLEMENTATION 7

3.1 A NEW PROCESS MODEL 8

3.2 IN PRACTICE 9

3.3 TECHNOLOGIES IN IMPLEMENTATION 10

4. OBJECTIONS 10

5. TRACEABILITY 11

6. OUTLOOK 12

6.1 BUSINESS MODELS 12

6.2 TECHNOLOGIES 13

7. CONCLUSION 13

8. LITERATURE- AND INTERNET SOURCES 15

Whitepaper by ZERO defects - a project of Pickert & Partner GmbH

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1. THE PROBLEM

Are you thinking of a product that hasn't worked as expected lately? The cell phone battery that ran out way too fast?

The washing machine that stops spinning? The car that won't start? We don't want all this, but we experience it every

day. The battery must be replaced, the washing machine repaired, the car towed away. Or what happens if metal

splinters are found in your cheese? Nobody wants cuts in the

mouth and tongue.

The fact is: defects are omnipresent and it is hard to believe

that one day there will only be flawless products. But what

prevents us from taking the next step towards zero-defect

production? We say: Nothing. We just have to do it. For this

first step, we have written this whitepaper. It is a collection

of thougs, a source of ideas and an eye-opener at the same

time.

1.1. SPECTRUM OF DEFECTS

One thing is certain: not all defects are the same. When I put a pizza in the oven, I have to pay attention to the right

temperature and baking time so that it does not burn. If it does happen, it's annoying, but it doesn't have a bad effect

and it's relatively easy to correct: I'll just try it again with the next pizza. However, if the airbag is not triggered in a car

accident, such a defect already has a completely different quality. Because this is about people's lives. It is clear that in

some cases there must be no room for defects.

We experienced an extreme example on January 28, 1986, when the space shuttle Challenger exploded. The bad thing

about this event was that all the faults that led to this explosion were known in advance. A defective sealing ring

between two segments of one of the boosters had triggered the deadly chain reaction. A "will work" mentality of the

engineers led to the space shuttle launching anyway. The result: seven lives, billions of costs and, as a result, the entire

space industry was thrown back by years.

Fortunately, such an accident does not happen often, but it illustrates the effects it can have if defects are not

prevented. Who doesn't want to live in a world where all products work as expected? We all want to be sure that the

rope does not break during bungee jumping, that there are no glass splinters in our food or that our brakes work

perfectly.


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1.2 PRODUCT RECALLS

The example of the Challenger disaster is an exception for many. But the problem concerns one industry in particular

that we all deal with: the automotive industry. Most of us probably already had points of contact with one of the

numerous product recalls: In 2016 alone there were at least 1.3 million recalls in Germany. With 3.4 million new

registrations, this corresponds to a recall rate of 38%. It is also important that the average age of the vehicles was less

than two years. But even this is not yet the negative highlight. The highest level to date was in the USA in 2015. With

17.5 million new registrations, 45.8 million vehicles were recalled, a recall rate of more than 260%!

A look at the Figure 1 of the distribution of deficiencies shows that 56% of recalls concern the occupant protection

system. Together with electronics, steering and brakes, two thirds are safety-relevant functions that can have fatal

consequences in the worst case.

But not only our cars, but products from all industries are affected by recalls. A daily glance at produktrueckrufe.de is

enough. Everything can be found here: from tearing climbing ropes and carnival costumes with poisonous dyes to baby

food contaminated with germs.


http://www.produktrueckrufe.de/

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1.3 CAUSES AND EFFECTS

Why is the world and technology becoming more and more advanced, but a flawless production cannot be guaranteed?

The pressure on companies is increasing all the time. Innovation cycles and the time from the idea to the concept to

production and delivery to the customer, the whole time-to-market become shorter and shorter. Another aspect is that

customizing is getting higher, because products are becoming more and more individual, lot size 1 is becoming standard.

This starts with the configurable cereal and ends with the car, which you have been able to configure online according to

your personal ideas and wishes for many years. However, excellent quality and performance of the products as well as a

favourable price are tacitly assumed. Considering the ever increasing requirements for environmental regulations, more

and more standards, compliance, social responsibility, etc., all this has an impact on the product world in which we are

currently operating. It is becoming increasingly difficult to supply the right products in the right quality. And change is

happening faster and faster.

But isn't this development frustrating? And isn't it frustrating

to make mistakes over and over again? A large defect

frequency has above all further consequences: Delayed

deadlines, poor quality and in the end dissatisfied customers

who in the worst case will not return. Every company has to

face all these losses and for some years now there has been

an attempt to overcome these challenges with the help of

the ideas of digitization and Industry 4.0.

2. THE SOLUTION

The question always arises: wouldn't it be great if all products and processes work as expected? But how can this work?

For this we have to go back to the origin - back to the defects.

As early as the 1960s, Philip Bayard Crosby coined his "Do it right the first time" philosophy: he described back then that

defect prevention should take precedence over defect detection. This may sound like an old hat. But when you consider

that today companies spend on average 25% of their time correcting and eliminating defects instead of ensuring that

they do not occur in the first place - the issue is more important than ever.


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2.1 DEVELOPMENT OF DEFECTS

Looking at a typical product life cycle, defects occur in every phase. The well-known rule of ten (see figure) shows that a

defect - the later it is discovered - becomes exponentially more expensive with each phase. If you now imagine a car

recall, for example, you can quickly

accumulate gigantic sums here.

However, the decisive factor is

that 85% of all defects are

generated in the very early phases.

Due to this fact, many defects

could already be prevented in

these phases. As a rule, however,

too little time is invested here -

often on the grounds that there is

no time for it.

If a defect occurs in one of the

later phases, companies suddenly

have all the time in the world.

Because then these defects must

be corrected. And that's the

dilemma.

2.2 PREVENT KNOWN DEFECTS

Significant improvements could be achieved by early prevention of known defects. This does not only sound logical, but

can also be implemented in concrete terms. Instead, it is usually attempted by all means to further increase

productivity. This may make sense, but it does not help, as low productivity increases are disproportionate to the cost of

a single callback. Companies can win the most if they are consistent in their efforts to prevent known defects.

2.3 IDENTIFY UNKNOWN DEFECTS

All unknown defects, however, must be detected and analyzed as early as possible. An unknown defects may (must!) be

made. However, it must be ensured how it can be prevented in the future so that it does not occur again. We must

therefore develop into a learning culture in which defects can be discussed with everyone involved and everyone has a

genuine interest in living a continuous improvement process.


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If, however, the defects analysis is stopped as soon as the culprit has been identified, this will not help anyone. On the

contrary: exactly this behavior leads to an defect avoidance strategy of the people, in which the resulting defects are not

communicated transparently, but are concealed.

2.4 HOW CAN THIS BE ACHIEVED

Many companies rely on the possibilities of Industry 4.0 to solve their challenges. But often the only recommendation is

to further increase IT investments in manufacturing and the number of consulting days. As a rule, however, only costs

are produced and no sustainable results are achieved. This creates mistrust and reservations about IT solutions for

production optimization, although significant improvements could be achieved through the pragmatic use of existing

solutions.

What is still often overlooked today is an imperative

link between quality, production, process and

organization. An isolated coexistence and lack of

communication inevitably lead to efficiency losses and

repetition defects and prevent learning from defects.

Many thoughts and concepts in the Industry 4.0

environment are not new insights or technologies.

They simply need to be placed in a common context,

creating new opportunities to increase process and

product quality, productivity and ultimately

competitiveness and customer satisfaction.

The task in companies is therefore to meet these

requirements, i.e. known defects must not occur in the

first place, production must be adaptable and, if the

worst comes to the worst, everything must be traceable. Solutions must adapt to the needs of the users, use existing

standards and technologies and ensure a meaningful integration of existing and functioning systems. This is the only

way to meaningfully analyze, aggregate, filter and profitably distribute the information generated along the entire value

chain. In this sense, Industry 4.0 then serves the companies and helps them to look successfully into the future.

3. THE IMPLEMENTATION

So what is a concrete approach? Actually quite simple: All influencing variables and parameters must be identified and

considered holistically. However, a failure rate of over 70% for IT projects of any size, duration and scope of functions

shows that in reality this is not easy, but very complex. A different approach is therefore needed.


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3.1 A NEW PROCESS MODEL

If you look at an entire production process, it makes sense and is correct to first take a closer look at only the process

step for which the biggest problems or highest costs are known. For this step, all influencing variables and parameters

that safeguard this step must be determined and analyzed. Based on this information, the next step is to determine

which technologies, systems, software and skills are required for this protection and bring everything together. If work is

carried out in such a consistent and focused manner, a solution is found within a short period of time that safeguards

this one process step. Usually the result is zero defects and the success is measurable.

If new requirements arise during processing or if existing requirements change or new, unknown defects occur, it can be

reacted to quickly and effectively. These changes in turn can have an influence on previous or subsequent process steps,

so the interactions must be considered separately. The good thing about it: when processing a further process step, this

can be planned and taken into account right from the start. The step-by-step approach in combination with the

small-scale nature of the solutions brings measurable, visible and rapid success that motivates and ensures a high level

of acceptance.


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3.2 IN PRACTICE

This process model has already been successfully implemented in many concrete projects. In these projects, everything

is secured without programming and using standardized functions and communication in such a way that, based on

current knowledge, no part leaves the plant that is not defect-free. Concrete results are:

+ Ident-related control of production, processes and recipes

+ Enforcing the correct setup levels and settings

+ Central control and monitoring of settings, parameters and programs

+ Interlinking of all processes, process steps and work steps

+ Feedback and results from production and quality for the control system

+ Cross-company across any number of plants

Our customers have integrated hundreds of machines, in many countries, on several continents. These machines are

completely different (currently 70 machine types and PLCs from over 35 different manufacturers), run in 24/7

continuous operation and everything is completely standardized. New machines and systems can usually be added to

the network without on-site installation.


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3.3 TECHNOLOGIES IN IMPLEMENTATION

For the first steps it makes sense to consider certain technological factors in the implementation. As a little help we

offer a short list of some technologies and requirements with which we have had positive experiences.

INTEGRATION

OPC-UA Due to heterogeneous infrastructures, standards are required that enable consistent integration. OPC-UA has become

the industry standard in recent years and is supported by most manufacturers, enabling comprehensive integration.

Open IT architectures

Necessary functionalities are usually specialized on concrete requirements. Therefore, an architecture that enables

simple integration of these small apps (e.g. microservice architecture) is necessary. Important: there must also be

possibilities to integrate legacy systems, where the architecture is often not open.

IT-Security When data is stored in the cloud, IT security is a mandatory requirement. It makes sense to use platforms of large

providers for this purpose. They already have a lot of knowledge and have invested a lot of money to secure the data and

access.

Identification and interpretation of data

The added value of integration only arises when data is also exchanged between systems. This also requires the

knowledge of the employees, since the data must be understood and then provided with meta-information in order to

become semantically exchangeable at all.

DIGITIZATION

Smart Data There is no point in simply collecting all available data. Rather, you have to think specifically about which data is actually needed. Only the data must be collected with which one can gain meaningful knowledge with suitable semantics and algorithms.

Communicating knowledge

It is necessary that data is distributed at the right time to the right place on the right device for the right role. By closely and trustingly involving the employees, this knowledge becomes usable and can be distributed with suitable dashboards, for example.

Holistic view A holistic view of quality, production, process and organization is necessary. Only in this way can the interaction between the individual systems involved and the people become visible and can be used for a continuous improvement process.

4. OBJECTIONS

A high degree of automation can cause people to be overwhelmed. In addition, further resistance comes from the

organizations: for example, IT systems are critically assessed on the basis of past experience. There are fears that risks

will be underestimated. One wonders whether users' expectations are being met or whether it is just another expensive

and complex IT project that is not working.


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These fears are in a way justified, because often in the end

what one expected does not actually come out. What's the

reason for this? Most people hope for something that can

only be achieved through the interaction of good software

and good use. In Industry 4.0, one of the expectations is

that production organizes itself, orders are dynamically

controlled by the Shop Floor and everything communicates

with each other. At the same time, many companies are still

organized hierarchically-tayloristically and it quickly

becomes clear: this does not fit together and leads to the

attitude: "This cannot work for us!”.

Users must be allowed to take responsibility and decisions. Only then can they use their full potential. This requires the

support and trust of their companies. An agile work organization with an iterative approach of collaboration in

interdisciplinary teams is a helpful approach here. Companies must create a sense of work and bring thinking and action

together. Users at all levels must be empowered to make decisions - from the worker to the manager, from the shop

floor to the top floor. To put it in Tim Ferris's words: "It's amazing that a person's IQ seems to double when you give him

responsibility and make him feel you trust him!" 1

Everyone must have the feeling that they can influence and drive the processes instead of being driven by them. This

helps to reduce prejudices and mistrust. Due to constantly increasing complexity, it is imperative that people are not

overwhelmed with too much and also pointless information and that the IT systems used can be used intuitively and as

required. Thus, the information and parameters necessary for the respective decision are needed and ideally also the

consequence that a decision entails. Enabling decisions to be made will pave the way to prevention. To achieve this, the

right information must be in the right place at the right time on the right reel. It must be simple and intuitive and

precisely tailored from a variety of data sources and information. The dynamic display and hiding of relevant

information is just as much a must as the use of various technologies (browser, mobile, tablet).

But what effects does this have for the individual employee? The roles are changing. This change must be taken into

account by first enabling employees to keep up with this change. This is exactly where to start: Education, continuous

learning, training - the entire education system must be questioned in order to do justice to the age of digitization.

1 Ferris (2012)


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5. TRACEABILITY

The special feature: if the integration of quality, production, process and organization is promoted and implemented

step by step, an additional and automatic active traceability across the entire value chain (from the suppliers through all

plants to the customer) is created. All relevant data can be assigned individually to each batch or serial number.

By combining all data to control and monitor the processes, the above described possibilities for the prevention of

known and early detection of unknown defects result.

In addition, however, it is possible - if a defect does occur at the customer or in the field - to search for, identify, analyze,

evaluate and document defects in the complete data archive, which provides 100% security in the case of an defect.


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6. OUTLOOK

With the implementation of the ideas described above and the outcome of these, a new basis for further changes will

emerge which will come to us in the coming years or which are already on the horizon. With the possibilities for

innovation, scaling or even disruption, you make your company fit for digitization and the future.

6.1 BUSINESS MODELS

In addition to the technological changes, it is important to review the business models so as not to run the risk of losing

connection and thus competitiveness. Sometimes there are just other price models or additional services in the

products. Collaborations open up new ways of marketing. Two-way platforms that connect suppliers and customers

enable completely new ideas for the products. The intelligence built into the products creates new communication

solutions.

6.2 TECHNOLOGIES

New technologies often open up new possibilities. With a technology based on modern concepts, ideas and innovations

can be quickly realized, tested and implemented according to the motto "Fail fast, learn fast". In addition to the topics

already in use, such as apps instead of monolithic systems and cloud and edge computing, here are a few more concrete

examples:

+ Blockchain technology: Decentralized and secure data storage and trust-based transactions (Smart Contracts)

allow traceability data to be collected over the entire product lifecycle and used for active customer information

(e.g. for recalls).

+ Augmented Reality: By displaying digital information in the real field of view, it is possible to visualize defects

directly on the product or the environment (e.g. hot temperature zones on a machine).


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+ Virtual Reality: Especially in engineering, potential defects in products, systems and plants can be identified

early and cost-effectively.

+ Artificial intelligence: The increasingly important decisions can be supported faster and better by AI. First

through information, later through recommendations and finally through independent decision-making.

+ 5G: The coming mobile communication standard will scale communication in terms of availability, speed and

data throughput, which will also allow it to be used in a production environment and will make a major leap

forward in communication and integration of all systems.

+ Digital Twins: The combination of different technologies enables the virtualization of systems and their

connection to real objects, making engineering, monitoring, maintenance and much more considerably more

efficient and significantly more cost-effective.

+ Chatbots: When identifying potential defects, analyzing them and designing processes, intelligent chatbots can

actively support people by providing information on all topics that are already known.

We look forward to what the future will bring!

7. CONCLUSION

It's not about making no more mistakes. Nor is it about managers and executives having to tolerate or accept defects.

The point is to talk openly about the causes of defects and to remedy them at an early stage. The decisive: The path to

zero-defect production can only be taken together.

We should not seek and develop solutions for the problems and sources of defects of others, but rather always support

the people involved in finding solutions themselves. This applies in particular to managers. When an executive identifies

and solves an employee's problem, it is usually well-intentioned. But what happens is nothing more than the grossest

form of incapacitation and criticism. The employee has only two options for dealing with it. He can show his superior

that his solution is also not so good and thus maintains his competence and his self-esteem to some extent. Or he can

take over the solution from his superior and has thus learned that it is probably the responsibility of the superior to

recognize and correct defects.

We should always be seriously interested in why mistakes have happened or why people decide differently from

ourselves. Because they do not do this against their better judgment, but act according to their best endeavours. This is

due to a different assessment of the situation or the lack of relevant information that makes a different approach

subjectively meaningful.

We should not celebrate the heroes who seemingly manage to save hopeless situations any louder than people and

groups who reach their goal without difficulties and escalations. If an organization has learned that it needs heroes, it

has also learned that it needs difficult situations. And if she has learned that heroes can solve difficult situations, then

there is hardly any reason to prevent them.


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If companies think in processes instead of in products, identify the influencing variables on each process, systematically

secure all processes step by step, adapt the business models and change the organization towards more agility and

self-control - then a zero-defect production becomes possible.

And then a world in which all products work as expected is also conceivable!


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8. LITERATURE- AND INTERNET SOURCES

● Ferris, T. (2012), Die 4-Stunden-Woche - Mehr Zeit, mehr Geld, mehr Leben, 1. Auflage. Berlin: Ullstein

Buchverlage.

● https://www.adac.de/infotestrat/reparatur-pflege-und-wartung/rueckrufe/rueckruf_jahresbericht.aspx

(20.03.2018)

● http://www.ibusiness.de/aktuell/db/776361jg.html (20.03.2018)


https://www.adac.de/infotestrat/reparatur-pflege-und-wartung/rueckrufe/rueckruf_jahresbericht.aspx

http://www.ibusiness.de/aktuell/db/776361jg.html

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