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Collecting, Storing and Utilising Information about Improvement Opportunities:
- A Discussion of the Non-Technological Barriers to Success.

Presented at SEKE conference 1999 by
Henrik M. Giæver
http://www.giaever.com

Det Norske Veritas, Veritasveien 1, N-1322 Høvik, Norway.
http://www.dnv.com

Abstract. Total Quality Management (TQM) in various forms has for decades proved successful in improving productivity; continuous improvement and learning being essential tools also in Det Norske Veritas (DNV). Our suggestion for any improvement system is 1) Adjust ambitions to the socio-psychological climate in a unit before embarking on the explicit improvement road. 2) Without the backing of other managers, solutions may create harm rather than improvements 3) In a small unit, sophistication of the information technology will have insignificant effects 4) Align the reward mechanisms closely with what is to be achieved. 5) First analyse information that is collected for other primary purposes; then consider creating supplementing systems. This is based on our experience as a Quality System Advisor and Lead Auditor as well as with the Total Quality Management (TQM) practice of Det Norske Veritas (DNV). An improvement process was created and used for 9 months in a small unit in 1995-1996. No sophisticated technology was used. Many improvements took place in the 9 month period the system was operated, however it is questionable whether the success matched the expense (time, frustration, interpersonal friction, unrest). In this paper we describe the life and death of a small scale experience-database.

1 Introduction
Det Norske Veritas (DNV) is a knowledge intensive organisation that serves the international marketplace with a broad range risk management services. DNV has committed itself to TQM as its management philosophy, and is presently also working to provide the concepts, methods and tools for managing its Intellectual Capital. With the capability of TQM in producing efficiency and results for a wide range of very different organisations, and the present awareness of the importance of knowledge for the survival and success of organisations, there is a need to reflect on how organisational learning can be accelerated.

Within the framework of TQM and Knowledge Management (KM) it may be tempting to create costly information systems to record, analyse and take decisions about non-conformities and other improvement opportunities

In the maritime marketplace DNV has for more than 10 years systematically gathered information about incidents and accidents with the goal of improving our knowledge and providing improved services to our customers.

The internal improvement efforts in DNV vary and depend to a great degree on local initiatives.

In 1995 one unit took various TQM initiatives; a range of learning activities (courses) were initiated for the team alongside developing a process oriented and customer focused quality system. In this paper we will concentrate on the improvementsystem that was created (see figure 1).

2 The improvement system
The unit employed 14 persons involved in development and operational tasks; primarily serving internal customers.

Each employee was encouraged to identify and report (2) improvement opportunities (IO) (non-conformities, complaints; anything that could be improved in any way). Information was also collected directly from customers and via customer feedback forms that were used in larger deliveries.

The dominant reporting tool was MS e-mail (3). IO's were indiscriminately added to a MS Word file; open for all (4). Acute problems should be taken care of immediately, chronic problems should be reviewed by management every three weeks (6). A point was made of not rushing to conclusions; issues should be considered as a whole, some of them possibly having a common cause. A particular form was designed such reported issues could be grouped under one "problem".

One example of an actual "problem": "The standard of our premises" This was based on a number of observations, e.g. "950622: some of the white-boards seem dry; how often are they waxed?" "950824: The shelves are messy, and the standard varies", "950616: It would be beneficial if every room has a box for stuff that people leave behind", "Week 39: "many of our clients are unable to find the right room", "951208: We should all be able to operate the essential technical equipment in the rooms", "950616 What equipment should actually be in each room? Do we have a clear standard?".

The consequences of these undesired conditions should be elaborated; "There will be a waste of time, danger of misunderstandings and dissatisfaction for all parties involved, and the reputation of the unit and DNV will suffer", and a problem definition established: "The risk that our premises give a messy and unprofessional impression is unacceptable".

The form encouraged identification of causes as well as root causes, and the preparation of an action plan with allocated resources, calendar time and responsible (7). After implementation of the chosen solution (8), the effect would periodically be reviewed(9).


Figure 1 The improvement process in a DNV unit 1995-1996 (see gif)

3 Well, how did it go?
In retrospect, substantial improvements were made in the period, and our customers reported improved satisfaction and increased interest in buying our services.

After 9 months, other issues in the department demanded the better part of the attention, the unit merged with another, there was a management reshuffle and the improvement system quietly died.

It is highly questionable whether the success matched the "expense"; time, frustration, interpersonal friction, unrest.

4 Some Lessons Learned
1.     The time needed (calendar as well as man-hours) in creating, agreeing upon and getting used to the system was considerably underestimated.
2.     The attention of the system competes with day-to-day operation and is uncritically given a lower priority.
3.     9 months proved to be a to short period to create enduring new habits.
4.     The lack of similar initiatives in surrounding environment made the system vulnerable to organisational changes.
5.     The system fuelled insecurity and suspicion if already present.
6.     Such a system requires a rare combination of abstraction and down-to-earth attitudes in order to work well.
7.     "Involvement" and responsibility are far less sought after bu the employees than "modern" managers like to think.
8.     "Explicit knowledge" (e.g. a statement in an e-mail or in an open file) has a high potential for misunderstanding and unproductive conflict.
9.     The (lack of) use of information technology had no impact on the effect of the system.
5 Conclusions and recommendation
Our assistance to other companies in developing or assessing their quality systems confirms the experience in a unit in DNV. ISO 9001, 4. 13 (non-conformities) and 4.14 (corrective/ preventive actions) always create questions, tension frustration and unrest.

That is no reason to take lightly on these topics; together with innovation and explorative learning they represent a gold-mine for the organisations that succeeds. The main obstacles are not technical; they are human.

Consider:

1.     Adjusting ambitions to the socio-psychological climate in a unit before embarking on the explicit improvement road.
2.     Whether there is support and commitment from higher management; without their backing solutions may harm more than improve.
3.     How to stay in step with the rest of the organisation. If you want to pioneer; make sure the rest of the team agrees.
4.     How well is desirable behaviour rewarded and undesirable behaviour discouraged?
5.     First analysing information that is already collected for other (primary) purposes. This may be of great value in the chase for improvement opportunities. Can the existing system be moderated to capture more?
6.     … whether the creation of dedicated IT systems are worth the expense, in a small unit, sophistication of the information technology will have insignificant effects compared to the other items in this list.

References
1.    Argyris, Chris, 1991: "Teaching Smart People How to Learn". Becoming a learning organization, Harvard Business Review Reprint 1997, Boston.
2.    Argyris, Chris, 1994: "Good Communication That Blocks Learning. What is a Learning Organization?", Harvard Business Review Reprint 1997, Boston.
3.    Buene, Leif & Moen, Anne Sigrun 1996: Organisational Learning. Tech. Report. DNV 97-2011.
4.    Deming, Edwards W., 1986: "Out of the crisis". Cambridge University Press. Cambridge.
5.    Det Norske Veritas, CMS 110 1997: Total Quality Management in DNV, rev 0, 1997-04-24.
6.    European Foundation for Quality Management, 1996: Assessor Manual/ Training binder. EFQM, Bruxelles.
Giæver, Henrik, 1998: "Does Total Quality Management Restrain Innovation?", Sociology Thesis, University of Oslo.
8.    Hackman, J.Richard, 1995: "Total Quality Management: Empirical, Conceptual, and Practical Issues". Administrative Science Quarterly, no 40.
9.    Giæver, Henrik, 1999: "Knowledge Management in DNV" http://research.dnv.no/Knowman/
10.    March, James G. 1991: "Exploration and Exploitation in organizational Learning". Organization Science, No. 1, February 1991.
11.    Nonaka, Ikujiro, 1991: "The Knowledge-Creating Company". Harvard Business Review Reprint 1997. "What is a Learning Organization?" Boston.
12.    Thomsen Jan 1998: The Virtual Team Alliance (VTA): Modeling the Effects of Goal Incongruency in Semi-routine, Fast-paced Project Organizations. PhD dissertation, DNV report 98-2024, 1998.