World-class quality is a standard that constantly re-defines itself as companies achieve ever-higher levels of quality at ever-lower costs. There are several valid ways to define the term “quality”—for example, by product attribute or customer acceptance. The one I prefer is quality as conformance or defect rate. Based on more than two decades of hands-on research, I have concluded that achieving world-class quality requires a methodology that: a) simplifies complexity and thereby the mistakes that that condition triggers; b) aims at developing devices that remove the possibility of mistakes; and c) turns adjustments into settings, thereby eliminating adjustment errors. Dr. Galsworth and I call this approach: The SMS Method: Simplify + Mistake-Proof + Set.
The SMS Method
The SMS Method is a quality system that addresses the three core defect sources through three techniques:
- Simplify: Complexity is the first enemy. You can eliminate fully half of all mistakes and save enormous amounts of money by simply simplifying—everything: products, production, tooling equipment, processes, testing, documentation.
- Everything and anything you can simplify will have a dramatic impact on mistakes, our next enemy.
- Mistake-Proof: You can eliminate or control virtually every mistake in a production environment. Any investment you make in doing this more than pays for itself in the spectacular results.
- Whatever you invest in mistake-proofing will be returned in cost savings—every penny.
- Set: Adjustments are the third enemy. At the heart of this technique, you convert adjustments into settings—and your settings then control variation. This alone can eliminate 98% of all adjustment mistakes—and, simultaneously, over 98% of your set up time. That means you not only save a ton of money, your customers get perfect products, delivered on time.
As we will now show you, the SMS Method doesn’t just deliver perfect quality—but it pays you to do so.
Many companies attempt to reach their quality goals through SPC (Statistical Process Control)—and those who do rightly conclude that quality is very expensive. Study after study shows that SPC is a costly approach that produces only modest reduction in defects. For example, Xerox conducted a benchmarking study of some of the best US companies then using SPC (including Six Sigma). After SPC, defect rates in these companies still ranged from a few thousand to over 10,000 defects per million operations—not even close to the Six Sigma claim of 3.4 parts per million (Figure 1, purple area). The same study showed these companies spent 6% to 24% of their production budget on quality control, scrap, rework, repair, and warranty costs. This is expensive by any measure.
The Mistake-Proofing Only View: Quality is Free
By way of contrast, the same Xerox study showed global quality leaders that invested in mistake-proofing (poka-yoke) as their quality method of choice achieved defect rates below 30 defects per million operations (Figure 1, green area/lower left). They spent less than 3% of their production budget on quality, scrap, rework, repair, and warranty expenses. Shigeo Shingo, co-architect of the Toyota Production System, described poka-yoke as zero quality control—meaning you can offset your investment in the poke-yoke approach with cost savings and production gains. This makes excellent quality free. An impressive result—but in my view and after two decades of research, FREE is still too expensive.
The SMS Method: Perfect Quality Pays
By contrast, the quality system that we teach—The SMS Method—is different from any other. Because SMS focuses on the three sources of defects (complexity, mistakes, adjustments), it not only achieves exceptional results reliably and predictably (even when compared with Shingo’s poka-yoke)—but it also pays you to use it (Figure 2). Companies make money when they effectively apply The SMS Method, a unique quality system that has repeatedly produced a 95% reduction in assembly time, product cost, and defect rate. The rest of this series provides a closer look.