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PROFESSIONAL PRACTICE Sustainable


CI methodology
A sustainable continuous
improvement methodology at an
671
aerospace company
Received September 2005
Nadia Bhuiyan and Amit Baghel Accepted October 2005
Mechanical and Industrial Engineering, Concordia University,
Montreal, Canada, and
Jim Wilson
Pratt and Whitney Canada, Longueuil, Canada

Abstract
Purpose The purpose of this paper is to present a continuous improvement methodology
developed in an aerospace company that is successfully being used by other companies in various
industries.
Design/methodology/approach A case study was undertaken at a medium-sized aerospace
company for over a span of one year. Data was collected through in-depth interviews, attendance at
formal and informal meetings, observation, and company documentation.
Findings The paper provides an overview of a continuous improvement methodology known as
Achieving Competitive Excellence (ACEe), which aims to achieve world-class quality in products and
processes. The paper describes in detail the tools and techniques needed to implement and maintain
the methodology. It was found that the company is very successful in addressing a wide range of
aspects in the organization, always with the viewpoint that the customer is number one. This
methodology is successful to the point that it is being used by other companies in various industries.
Practical implications The approach of the ACEe methodology can be applied to a variety of
companies.
Originality/value This paper presents for the first time the comprehensive Continuous
Improvement methodology ACEe. The paper should be of value to practitioners of continuous
improvement programs who are interested in a comprehensive approach to achieving excellence.
Keywords Continuous improvement, Quality, Lean production, Six sigma, Aerospace industry
Paper type Case study

Introduction
Organizations today are in a constant need to maintain a low cost of quality, reduce
waste, trim production lines, and speed up manufacturing to achieve and maintain
competitiveness. Much of this can be done through the implementation of continuous
improvement (CI), which we define as a culture of sustained improvement aimed at
eliminating waste in all organizational systems and processes, and involving all
organizational participants. CI can be evolutionary or revolutionary; in the former case, International Journal of Productivity
improvements take place as a result of regular, incremental changes, while in the latter and Performance Management
Vol. 55 No. 8, 2006
case, major changes take place as a result of an innovative idea or technology, or pp. 671-687
simply as a result of accumulating incremental improvements. Improvement on any q Emerald Group Publishing Limited
1741-0401
scale can be achieved through the use of a number of tools and techniques dedicated to DOI 10.1108/17410400610710206
IJPPM searching for sources of problems, waste, and variation, and finding ways to minimize
55,8 them.
Continuous improvement methodologies have evolved from traditional
manufacturing focused systems that concentrate on the production line to reduce
waste and improve product quality, into hybrid methodologies that focus on all aspects
of an organization, whether service or manufacturing. Modern CI methodologies (also
672 called CI programs or tools) target a wide range of aspects in the organization and offer
varying benefits. Some of the popular CI initiatives are Six Sigma, Lean Production,
Balanced Scorecard, and Lean Six Sigma.
In this paper, we describe some well-known hybrid CI methodologies, and introduce
a new methodology known as Achieving Competitive Excellence, or ACEe, a
comprehensive and sustainable CI program that covers a broad range of improvement
initiatives that was developed in an aerospace company. The paper is organized as
follows. The next section discusses the existing research in this field, followed by the
research methodology used. The ACEe methodology is then discussed in detail, after
which it is compared to existing CI methodologies. Finally, we end with some
conclusions.

Existing research
Continuous improvement is a philosophy that was described by Deming as
improvement initiatives that increase successes and reduce failures (Juergensen, 2000).
Some consider CI to be an offshoot of existing quality initiatives like Total Quality
Management (TQM) or as a completely new approach of enhancing creativity and
achieving competitive excellence in todays market (Oakland, 1999; Caffyn, 1997;
Gallagher et al., 1997). It has also been defined as a process of focused and continuous
incremental innovation that takes place across an organization (Bessant and Caffyn,
1994). Although CI can help organizations solve many of their process and quality
related problems, it is a process of incremental steps in which micro improvements are
achieved, though not always evident, while macro results are more evident over a
prolonged period. According to Walden (1993), Continuous Improvement does not
mean only repeated small improvements. Continuous Improvement means repeated
improvements of any size.
Berger (1997) summarizes the principles of CI in three parts: process orientation,
small step improvement, and people orientation. The process orientation principle
states that processes need to be improved before results can be improved, and suggests
that organizations must shift from being goal-oriented to process-oriented if any
lasting improvements are to be sustained. The small step improvement principle
suggests that standards, and adherence to them, are necessary for improvement.
Standards provide the benchmark against which improvements can be measured.
Finally, the people orientation principle is the well-known principle that people are at
the heart of CI programs. It has become clear that without their active involvement, CI
in any organization cannot be successful. As Juergensen (2000) suggests, Continuous
improvement comes only from people - people learning things they can learn, solving
problems they can solve, implementing improvements they can implement.
The benefits of CI are well-known: total employee involvement and support
resulting in greater interaction between management and workers; employee creativity
fostered through encouragement to generate suggestions and new ideas to improve
working conditions; continuous staff development and satisfied employees as a result Sustainable
of CI trainings; increase in consistency and conformity of products and processes; CI methodology
faster response times as processes are documented and in place; and a well-tuned
organization with less waste (Womack and Jones, 1996; Michela et al., 1996; Pyzdek,
2000).
While the benefits of CI are well-documented, there is no panacea or magic bullet
to achieve CI and the results of improvement efforts are not always immediate and 673
all-encompassing (Webster, 1999). For example, the results of CI initiatives can be slow,
which may result in management abandoning the effort, believing it to be a waste of
time and money. Another important concern is the high investment both in terms of
capital, such as restructuring costs, licensing costs, hiring consultants, and resources
that might be required if the whole organization pursues CI. Other drawbacks of
implementing CI are the increased expectations of management on the employees, and
the extra pressure and workload needed to implement CI practices. Implementing CI
initiatives is not a straightforward undertaking, and not all initiatives are applicable to
all organizations. Berger (1997) suggests that CI programs can be applied to different
types of work environments depending on product design and process choice, but must
be adapted to the degree of standardization involved.
The modern-day CI programs are more popularly associated with the TQM
movement. TQM is the development of an organizational culture of achieving customer
satisfaction through an integrated system of tools, techniques, and training (Sashkin
and Kiser, 1993). Continuous improvement, customer orientation and process
orientation have been referred to as the three core fundamental principles of TQM
(Hill and Wilkinson, 1995). The real strength of TQM is that CI, and hence people, is the
very basis of the concept (Webster, 1999). TQM is not a solution to the problem but an
approach to managing effectively an organization, which is built around CI (Kanji and
Asher, 1996).
While CI programs help to improve organizational operations in many aspects, they
are not necessarily effective at solving all issues. For example, TQM was being used as
the primary quality initiative by the manufacturing organizations, but with TQM there
was no clear way of prioritizing which quality project should receive the highest
priority, and the projects were carried out irrespective of the cost to the corporation.
This was one of the reasons for the advent of Six Sigma. Six Sigma is quite explicit
about the financial benefits expected from each and every effort. According to the Six
Sigma initiative, each and every Black Belt and Champion is expected to contribute
between $250,000 and $100,000 of incremental profit every year (George, 2002).
However, Tatham and Mackertich (2003) state that while Six Sigma can be beneficial, it
is not appropriate for widespread use. Six Sigma alone cannot dramatically improve
process speed or reduce invested capital. Lean Production cannot bring a process under
statistical control. To overcome the weaknesses of one program or another, a number
of companies have merged different CI initiatives together, resulting in a combined CI
program that is more far reaching than any are individually. Therefore, as one
example, the combination of Six Sigma and Lean Production, or Lean Six-Sigma,
evolved since maintaining higher production rates and high quality, or producing less
waste, is not enough for many companies.
Another example of such company is Pratt and Whitney Canada (PWC), an
aerospace company that has developed a tool that has reaped enormous benefits
IJPPM company-wide. This methodology, called Achieving Competitive Excellence (ACEe),
55,8 has even been marketed and is used by various companies from different industries. In
this paper, we present a case study conducted at PWC, whereby we study the details of
the companys methodology, and compare it to existing methodologies such as Lean
Production and Six Sigma.

674 Research methodology


Based in Longueuil, Quebec, PWC is a world leader in aviation engines powering
business and regional aircraft and helicopters, and offering advanced engines for
industrial applications as well. PWC is a subsidiary of United Technologies
Corporation (UTC), a high-technology company based in Hartford, Connecticut; its
operations and service network span the globe. Data for the study was gathered from
company documentation, observation of various organizational processes, interviews
of key personnel, attendance at project meetings, and many informal discussions. The
case study also involved studying ACEe and comparing it to Six Sigma and Lean
Production, the two major CI programs available on the market. In what follows, a
detailed description of the program developed at PWC is given.

Achieving Competitive Excellence: the ACEe methodology


ACEe is a comprehensive methodology that is based on the principle that the
customer is number one. Developed over two decades, the methodology combines the
benefits of statistical quality control, business and manufacturing process
improvement, quality escape identification, root cause determination, and preventive
actions to eliminate escapes in the future. Essentially, the ACEe methodology is a
combination of the best of Lean Production, Six Sigma and Balanced Scorecard into a
progressive implementation plan with the aim of resulting in true culture change in an
organization. ACEe stands on three foundations:
(1) a philosophy about competitive excellence;
(2) an operating system (with tools) for controlling and improving the processes
and eliminating waste; and
(3) the competence, commitment, and involvement of the entire organization to live
the philosophy and to apply the operating system to everything that is done.

ACEe is a company-wide program that focuses on the drivers of customer and


investor value: the processes and people who fuel them. The methodology involves all
employees, leaders, and associates alike and it touches all the manufacturing, business
and supporting processes that create and deliver customer value. Customer feedback is
critical in strengthening the value provided to them and to increase their satisfaction.
The ACEe methodology can be adapted to any industry sector, and to companies of
all sizes.

History of ACEe
Based on decades of expertise in CI initiatives, the ACEe methodology was developed
and has matured into a sustainable CI program at PWC. The roots of ACEe date to
kaizen events held at PWC in the early nineties to reduce manufacturing costs and
improve delivery performance. Kaizen events provided each of the UTC divisions with
the opportunity to break out of the normal paradigm and look at continuous Sustainable
improvements not as incremental but as requiring radical improvements. CI methodology
Improvements of 3 percent and 5 percent were no longer acceptable business goals,
and the employees turned their attention to achieving 20 percent, 30 percent and 40
percent improvements.
An initiative began in 1994 to understand and remedy the low effectiveness of
engineering productivity, but it disappeared by 1996 because of the daunting size of 675
the task and the inability of each division to link and prioritizes the impact of the
proposed metrics on business results.
ACEe formally began and took its name in 1997 at PWC, at a time when the future of
the company looked grim. A quality engineer then assembled a toolbox of methods for
improving both quality and delivery. At that time, UTCs Senior Consultant in Quality,
the late Mr Yuzuro Ito, worked with PWC to ensure the effectiveness, simplicity, and
ease of use of the ACEe tools for process improvement, problem solving, and
decision-making. Other divisions then began to use ACEe, and Mr Ito then deployed
training for hands-on learning experiences. About a year later, in his honour, UTC
established the Ito University to disseminate Mr Itos curriculum from the top down.

The ACEe philosophy


The philosophy of ACEe is a condensation of Mr Itos principle about quality, which
had been well tested during his long tenure at the Matsushita Corporation. The key
points were outlined as follows:
.
focus on process improvement with equal emphasis on quality and flow: Right
the first time;
.
nurture good hearts, good minds, and total involvement of the organization;
.
use simple, visual approaches to process improvement; and
.
rreasure problems for their learning potential.

The ACEe philosophy is also based on the belief that an ideal business, where a
business consists of a set of connected processes, uses an operating system to manage
these processes. The operating system is a mechanism for controlling and improving
processes to achieve desired business goals, starting with customer value and
satisfaction.
It consists of a set of tools that help an organization identify and solve problems,
improve its processes, and make strategic decisions. Through the repeated application
of these tools, the organization drives the ACEe operating system to:
. close gaps between actual results and business goals;
.
identify, quantify, and eliminate quality deviations;
.
eliminate waste (achieve lean process flow); and
.
create positive change using the power of the individual employee.

Over the years, the benefits of using ACEe tools at PWC have helped to improve
operations by reducing the total equipment downtime and customer escapes from 100
percent in 1999 to a little over 60 percent in 2001. Product lead-time has also been reduced
from 20-24 months in 1993 to 10-12 months in 1998, to below six months in 2003.
IJPPM The tools supporting the ACEe operating system are designed to continuously
55,8 improve processes and eliminate waste, to search for ways to find and solve problems,
and to provide a sound basis for making decisions. Table I lists the ACE tools which
are classified into three categories: Process Improvement and Waste Elimination
Tools; Problem Solving Tools; and Decision Making Tools.

676 Process improvement and waste elimination tools


5S 1
A major component of Lean Production are the 5Ss. 5S stands for Sort, Straighten,
Sweep, Standardize, and Sustain. The 1 refers to the consideration of
Environmental Health and Safety in everything. The 5S is used for organizing and
maintaining a workplace.
Sort. This generally starts with taking a tour of the workplace and marking the
excess items or items that are out of place. Once the items are identified and reviewed
they are put in their respective place or removed if they are not required.
Straighten. The goal of this activity is to establish a place for everything based on
usage, and keep everything in its place or to arrange the equipment and products in
such a way that it is easy to locate and use them when they are required. This is
achieved by labelling and arranging the equipment and products in order to support
visual identification.
Sweep. This constitutes cleaning the workspace and equipment. While the
workspace and equipment is cleaned, maintenance work can be carried out to prevent
any future breakdowns.
Standardize. This calls for maintaining and monitoring the first three Ss;
integration of Sort, Straighten and Sweep would result in a successful standardization
and would lead to an increase in the speed, quality and safety in the work area.
Sustain. All the steps mentioned above would be of no use until they are sustained
over a long period of time. The idea is to make 5S 1 a way of life. They need to be
performed repeatedly in the same order to reap benefits.

Process management and standard work


A process is a series of activities that takes inputs and produces one or more outputs. It
is definable, relatively predictable and repeatable. Process management is a disciplined
approach applying preventive methodologies to improve process performance by
increasing effectiveness, efficiency and adaptability. Process management ensures:
that quality products arrive on time, first time and every time; better understanding of
the whole process and of the impact of work on customer delight; clarified roles and
responsibilities; easier integration of new employees; and reduced frustration.

Process improvement and waste Decision making


elimination tools Problem solving tools tools

5S 1 (visual workplace) Market feedback analysis Passport process


Process management and standard work Quality clinic process charts
Process certification Relentless root cause analysis
Table I. Setup reduction Mistake proofing
ACEe tools Total productive maintenance
Standard work is defined as simplified and structured work to ensure consistency and Sustainable
repeatability over time. It is achieved by a disciplined creation of requirements, work CI methodology
methods, tools, process, procedures and work instructions. Standard work ensures that
the best practices are imbedded into routine job performance.

Process certification
Process certification can be defined as the proper use of all the management tools, 677
techniques and initiatives available to assure that the organization has predictable and
capable processes which satisfy the organization and its customers requirements of
quality, delivery, and cost. Root Cause Corrective Action Process (RCCA) is at the
foundation of process certification. The basic steps for process certification are:
(1) describe and understand the situation;
(2) identify required resources to detect the root causes;
(3) identify, select and prioritize probable root causes;
(4) validate probable root causes;
(5) identify, select and prioritize potential solutions;
(6) validate potential solutions;
(7) implement action plan and monitor effectiveness of solution; and
(8) standardize similar process.

Setup reduction
A setup is the time elapsed between the last part (after inspection) of the previous batch
of products being manufactured and the running of the first part of the following batch.
The methodology behind Setup Reduction is to determine the total setup time, find the
average setup time, determine the bottleneck equipment and parts with their impact on
setups, and identify the starting point of setup data collection on similar parts. Once
the above steps are followed and the new setup procedures finalized they are
documented to ensure continuity in the application.

Total Productive Maintenance (TPM)


TPM is an equipment management strategy designed to achieve maximum equipment
efficiency and availability by involving: Operators, Maintenance, Technical Support,
and Management. The major TPM objectives are Maximize effectiveness and
efficiency (Lead Time), Improve reliability and maintainability (Quality Lead Time),
Optimize cost during life cycle (Cost-effectiveness), Improve employee skills (Operators
& Maintenance), Create a proper environment for teamwork.

Problem solving tools


Market Feedback Analysis (MFA)
MFA is a process used to understand the needs of the customer to improve the quality
of the products and services. MFA is used to analyze customer complaints and then
work on the problem correction/product improvement. A customer could be internal or
external. Data is collected in the form of surveys and Quality Clinic Process Charts
(QCPC) forms. The survey results are sent to the change agents. Once the surveys and
QCPC forms are available, they are looked up in weekly meetings and problems with
IJPPM the highest priority are identified, proper action plans are developed, and the results
55,8 obtained are communicated to both internal and external customers.

Quality Clinic Process Charts (QCPC)


QCPC is a methodology used to identify problems though the application of a data
collection system. Customers both internal and external fill up a QCPC form if they
678 have any issues that they would like to be resolved. Employees participate in weekly
meetings and participate in continuous improvement. The change agents prepare and
hold weekly meetings with the supervisors and manage all CI issues during meetings.
They participate in CI workshops and clinic activities and provide feedback to the
employees. The supervisor manages weekly meetings with the change agents and
informs employees on the progress of the implementation via the communication
board. The QCPC deals with two types of problems: Official Problems such as quality
notifications, rework, repair and Hidden Problems such as health and safety
opportunities, delays and tooling/fixture not adequate. The goal of the weekly
meetings is to classify the QCPC turnbacks received, prioritize the actions to take, focus
on quality and cost reduction, and assign responsibilities.

Root cause analysis


This is a method for determining the root cause of a problem, applying the best
possible solutions and ensuring that the problem does not recur again by following
through and standardizing the solutions. It consists of eight steps of equal importance;
these steps are the same as mentioned in RCCA under Process Certification.

Mistake proofing
This is a mechanism that prevents defects by eliminating the possibility of error at its
source. There are two types of Mistake Proofing: Control and Warning. Control is
achieved by stopping the process before mistakes happen; Warnings are achieved by
indicating a situation that requires an intervention during the process.

Decision making tools


Passport process
The Passporte process is a unique gated new product development and design
process that allows for a structured review at every step in the development process,
from original market potential analysis through final product launch and customer
field monitoring. This process is similar to Coopers Stage-Gatee process. The
Passporte process incorporates past lessons learned and current technological
innovations.
The ACEe tools can be classified into different categories according to their
functions, as shown in Figure 1. These are prevention, identification, correction, and
workspace organization.
In keeping with the ACEe philosophy, the ACEe tools are relatively easy to learn
and use and they are accessible to everyone in the organization. In case of a specific
process improvement opportunity, the ACEe tools can be used in conjunction with one
another to form a closed loop problem solving strategy as seen in Figure 2.
It must be noted that not all of the tools described above autonomously drive
improvements. It is the associated methodology, specifically the ACEe Protocol,
which will be discussed next, which not only describes the desired use of the tools to Sustainable
control business processes but also sets the improvement targets that each cell in the CI methodology
company needs to attain in order to achieve the various ACEe levels: Qualifying,
Bronze, Silver and Gold. Here, a cell is defined as a natural division within PWC based
upon either a specific management reporting line or, more frequently, based upon
similar and complementary processes being performed within the cell. Often physical
location comes into play although not always. For example, in PWCs Customer 679
Support division, there are 11 distinct departments, each of which is an ACEe cell. In
the case of the Human Resources offices located in various cities across Canada, they
are all part of one cell in that they all use the same key processes to perform their tasks
and eventually report to one vice president.

Sustaining ACEe
One of the major challenges for any company is how to truly sustain CI activities. The
ACEe Protocol has been proven to be helpful in the progressive implementation of CI
tools throughout PWC.

Figure 1.
Grouping of ACEe tools

Figure 2.
Closed loop problem
solving methodology
IJPPM Certification levels
55,8 The basic premise behind the Protocol is a system of levels which measure competency
in the ACEe methodology.
Qualifying. General ACEe awareness education, local process identification and
prioritization, waste elimination and organization.
Bronze. Advanced ACEe training; full application of ACEe tools to a limited
680 number of key processes, 60 percent workgroup involvement.
Silver. Demonstration of improved customer and business performance,
documentation and streamlining of all key processes, defined employee satisfaction
target, 80 percent organizational involvement.
Gold. Best-in-class local customer satisfaction and local business performance, total
work group involvement.
Assessments must be scheduled by the ACEe Leaders and communicated to the
ACEe Central Team of PWC. The purpose of the assessments and reassessments
processes is to ensure that the ACEe criteria continue to be met. These are performed
as of the Bronze certification level and between 3 and 6 months after the attainment of
the certification level.
It is the ACEe Protocol that drives the real continuous aspect in the use of the
ACEe tools and each cells movement through the different certification levels. Table II
is one example of a manufacturing cells KPI improvement targets at PWC. As can be
seen from the table, the requirements of the ACEe levels are more and more
demanding as a cell progresses from Qualification through Gold (and beyond). It is not
inherent in each tool that there is a demand for improvement (including continuous
improvement). It is only through the use of an external force (the Protocol) that the use
of the tools can be guided in the right direction in order to achieve the business goals of
the company.

Competency in ACEe
Competency in ACEe resides in empowered employees and in committed and
involved leadership. ACEe competency is built up through many means:
.
Awareness education. Awareness-level training relates to the philosophy that all
employees need to be involved in CI activities. While there will be CI or Quality
experts (called ACEe Pilots), the average employee needs to be at least aware of
the various CI tools in use if that employee is to participate in their
implementation. The ACEe Protocol requires that awareness courses (usually
one hour in length) on certain tools that will be used by all employees (5S, TPM,
QCPC, etc.) be given to 100 percent of the employees in a cell.
.
Supervised action learning engagements (Ito University, ACEe Pilot training).
For more intensive learning experiences, there are more detailed courses which
ACEe Pilots and others attend to ensure that they have the necessary classroom
learning and practical application experience to apply specific tools within their
own cell. Typically, new ACEe Pilot training is a 2-week course.
.
Coaching, mentoring and teaching by expert ACEe pilots. An important aspect of
the ACEe methodology is having a local CI expert from within the rank and file
of the department who can best work with his/her peers to implement
improvement activities.
PWC ACE Manufacturing
2001 Certification Criteria Fabrication Shop Cell
Results Qualification Bronze Silver Gold
(typical implementation for
all levels) (1 to 4 months) (8 to 12 months) (10 to 18 months) (12 to 24 months)
Lead-time reduction The cell has begun using Widespread use of ACE tools 25 percent improvement 65 percent improvement
ACE tools Important business results
No important business are expected but are
results are expected at this unquantifiable for the time
stage being
Establish the baseline on The certification criteria
which the improvements will database is established
be measured
Reduction of rejects, 40 percent improvement 65 percent improvement
reworks, and escapes
Execution delay for EH&S 30 days 14 days
projects
Difference between the ^ 15 percent ^ 10 percent
estimated costs and the
actual costs
Percentage of planned work 60 percent 75 percent
On-time delivery 60 percent 85 percent
Product cost (significant Ten implemented Ten implemented
elimination of waste) opportunities opportunities (ten new
opportunities identified and
in the process of being
implemented)
EH&S No lost time 50 percent No lost time 50 percent
recordable recordable
Employee matrix Departmental training needs Training 100 percent
are defined completed
Other Bronze level is maintained Bronze and Silver levels are
for a minimum of 6 months maintained for a minimum of
10 months
CI methodology
Sustainable

certification criteria
Example of PWC cell
681

Table II.
IJPPM .
Doing. experience in many different improvement projects: Employees are
55,8 encouraged to participate not only in CI activities within their own cell but also in
activities related to their upstream or downstream value chain. The use of a
common language and ACEe Protocol requirements helps employees in being
able to apply what they are doing in their own cell to others.
.
Teaching and training others. Not only are ACEe Pilots tasked with training
682 their peers but average employees are often nominated as team leads and take on
leadership roles within the cell. The opportunity to share knowledge, specifically
between older, experienced employees and their juniors is an important part of
the use of a number of the tools.
.
Quality clinics. These are the primary tool to get together experts who have an
open exchange on problems and the corrective action needed.
The financial results of applying ACEe to improve business performance are recorded
in a master database called Quality Savings Tracking and Reporting Systems
(QSTARS). The cumulative financial impact of ACEe is the ultimate measure of
competency. It is important that employees understand and appreciate that the
underlying reason for doing CI is to improve the business. By first baselining business
results then setting aggressive targets for improvements (as in Table II), employees
can clearly see what needs to be done and how the cells performance is tracking
towards the goal. As a corporation, the overall cost of implementing the ACEe
methodology needs to be understood. The ACEe methodology is an investment in the
corporations future and the QSTARS database tracks all major savings generated at
the cell level relating to ACEe activities in order to make sure the company is realizing
a good return for this investment.

Value chain overview


At PWC, a value chain (VC) is defined as a series of high-level business processes
linked together to produce the goods and services that are provided to the customer. In
other words a VC must generate revenue for PWC. There are five VCs in PWC: Power
Plant, Spare Parts, Overhaul and Repair, Aerospace Components and Fleet Services.
The VC model also includes Governing and Support processes.
Each VC will have specific objectives defined. Each high-level process will have
pre-defined Key Performance Indicators (KPIs) that will be tracked on an on-going
basis to help determine the health of each process. A dashboard is used to provide
visibility over all of these processes performance. Finally, when the KPIs for a
particular process indicate negative trends which could affect the quality, cost or
delivery of products/services, the ACEe Leaders in accordance with the Value Chain
Steering Committee will launch a new High Impact ACEe Team (HIAT) to drive to
root cause and incorporate best practices and update Standard Work in the processes.
This pro-active approach to problem solving allows ACEe to correct situations long
before they impact customers.

Comparison of methodologies
While ACEe as a CI methodology is similar to Lean Production and Six Sigma, it has a
number of differences. Table III lists the similarities and the differences between the
three CI methodologies.
Sustainable
Major tool Six Sigma Lean production ACEe Description
CI methodology
Cp/Cpk U U Process capability assessment
DOE U U Design of experiments
SPC U U Statistical process control
FMEA U U Process/product risk assessment
Regression U U Variable effect analysis 683
Process mapping U U U Map of process detailed activities
5 Whys/2 Hows U U U Root cause identification tools
Pareto U U U Column chart rank priority
Fishbone U U U Cause and effect diagram
5S U U Waste elimination
Visual management U U U Implementation of visual controls
Poka-Yoke U U Error proofing techniques
Spaghetti chart U U Material flow or personnel movements
Kanban U U Automatic reordering process
TAKT time U U Pace of a process
Standard work U U Time required for activities in process
SMED U U Quick machine setup
TPM U U Equipment maintenance strategy
Cellular flow U U Production techniques
Passport U Gated review in design process
QFD U Quality function deployment
MFA U Market feedback analysis
QCPC U Quality clinic process chart Table III.
RCCA U Root cause corrective action ACEe v. Six Sigma and
Benchmark U Internal and external activities lean production

As can be seen, the ACEe methodology incorporates all the tools of both Six Sigma
and Lean Production, in addition has a number of other tools such as Quality Function
Deployment (QFD), Market Feedback Analysis (MFA), Root Cause Analysis (RCA),
Quality Clinic Process Chart (QCPC), and Passport, which are unique to ACEe and
helps the overall task of identifying defects and bottlenecks to improve continuously.
MFA is used to understand the needs of the customer to improve the quality of the
products and services; QCPC is used to identify problems in a cell through the
application of a data collection system; RCCA is used for determining the root cause of
a problem. All of these tools are integrated into the ACEe methodology, which makes
it a complete CI initiative. Having such a CI methodology in place enables an
organization to achieve reducing variation and improving process speed.
Table IV shows a comparison of all the major CI methodologies. The table compares
CI methodologies in terms of its objectives, principles, key performance indicators,
speed of returns, the tools used and the infrastructure required for the implementation.
Some of the observations that can be made are:
.
Lean Production is one of the oldest improvement methodologies and provides
high value to the customer by employing best practices such as 5S, mistake
proofing, Kanban, etc. Lean Production does not require highly specialized
resources and with little training Lean Production principles can be implemented
within the organization giving incremental returns.
55,8

684
IJPPM

Table IV.

methodologies
Comparison of CI
Methodology Inception Objective Principles KPIs Tools Infrastructure Speed

Lean Early 1900s but To provide high To use the best The value 5S, mistake Ad hoc resources Quick initial
production modern Lean value to the practices and provided to the proofing, setup can suffice, little returns and
thinking customer processes, to customer reduction and formal training, on then
introduced in early improve efficiency, other TPS tools the job training incremental
1960s reduce cost and
speed up the
process
Six Sigma 1986 Product and To keep the Number of DMAIC, DMADV, Dedicated Quick initial
process number of defects defects, SPC resources, very returns and
improvement, below 3.4 per customer specific skills then
minimization of million satisfaction incremental
variation opportunities
Lean Six 2000 Reduce variation, To use the best Customer Tools used in Six Dedicated Quick initial
Sigma speed up practices of Lean satisfaction, Sigma and Lean resources, very returns and
production and Production and Six market share Production specific skills then
reduce waste Sigma, to increase incremental
the market share of
the organization
ACEe 1997 To improve Use the tools Customer Passport process, Ad hoc resources Quick initial
customer available to reduce satisfaction MFA, RCCA, 5S, can suffice, little returns and
satisfaction by waste, improve mistake proofing formal training, on then
maintaining high speed and do the etc. the job training incremental
quality and things right the
delivery on time first time
.
Six Sigma concentrates on improving the business process of the organization by Sustainable
minimizing variation and streamlining processes by utilizing statistical tools CI methodology
such as SPC. Specialized resources with good understanding of statistical tools
are required to lead the improvements which are incremental but sometimes can
be breakthrough improvements.
.
Lean Six Sigma is the latest CI methodology and combines the benefits of Lean
Production and Six Sigma to provide value to the customer as well as minimize 685
variation by utilizing Lean Production and Six Sigma tools.
.
ACEe is very similar in concept to Lean Production and uses most of its tools in
addition to some CI tools exclusive to ACEe such as Passport and QCPC.

Each of the methodologies serves different purposes, and has advantages and
disadvantages. What distinguishes the ACEe methodology from other methodologies
is the inherent sustainability of the methodology. The use of the ACEe Protocol allows
different areas of the company to apply proven CI tools in both the evolutionary CI
steps as well as in revolutionary Six Sigma- like steps. Some of the important aspects
designed into the ACEe methodology are:
.
The gradual application of the ACEe CI tools allows for slow and fast adopters
to learn and begin using the CI tools within their own cells. The ACEe
Qualification level is all about training and communication and not about
concrete business results. Even the ACEe Bronze level is about understanding
the cells performance before demanding improvements. It is only at Silver and
Gold that cells are required to perform using the tools to make the improvements
necessary.
.
ACEe is a bottoms-up approach that uses the average employee to implement
positive change. The use of a dedicated ACEe Pilot taken from within the cell
greatly facilitates our ability to motivate employees.
.
The ACEe methodology becomes a single focal point for all CI activities within
the company. As focused projects are needed, they simply become extensions of
a cells regular ACEe activities. PWC has been running High Impact ACEe
Teams (HIAT) for a number of years which amount to Six Sigma projects. The
difference is that the same tools and methodologies are used for both these HIAT
projects as for a cells day-to-day activities.
.
The ACEe methodology is flexible and as the company matures in its adoption
of CI principles, new, more sophisticated CI tools can be added to the
methodology by simply incorporating them into the ACEe Protocol.

The question of sustainability is also one great differentiator. An ACEe cell that
achieves any given level does not stop there but rather turns the page in the ACEe
Protocol and looks to the next levels requirements. In this way, PWC has been able to
have cells self-sustain for as many as six years now without the cell losing focus.

Conclusions
CI methodologies have evolved from traditional manufacturing-focused systems that
concentrate on the production line to reduce waste and improve the product quality,
into hybrids that also focus on the organization. It has become clear that without the
IJPPM active involvement of the people, CI in any organization cannot be successful. Large
55,8 organizations are developing their own CI methodologies to fit their own needs by
encompassing the various tools and techniques of individual methodologies. This
signals the need for hybrid methodologies.
ACEe is a methodology that has been developed by an aerospace company in an
effort to undergo a major change, and it was observed that this could only be done by
686 improving many aspects across the organization on a sustainable and continual basis.
Today, ACEe is used in companies such as Alcan Primary Metal Products, Bell
Helicopter Textron Inc. and Camoplast. The methodology consists of all the tools used
by Six Sigma and Lean Production, but in addition has a number of other tools used to
carefully review and monitor the product development process, and help the overall
task of identifying defects and bottlenecks to improve continuously. All of the tools are
integrated into the ACEe methodology, which makes it a complete CI initiative that
addresses many quality issues. While all CI methodologies serve different purpose, and
have their share of advantages and disadvantages, one thing that sets ACEe apart is
its ability to sustain CI in the long run.

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About the authors Sustainable
Dr Nadia Bhuiyan holds a Masters degree and a PhD both in Mechanical Engineering from
McGill University, and a Bachelors degree in Industrial Engineering from Concordia University. CI methodology
She is an Assistant Professor at Concordia University in the Department of Mechanical and
Industrial Engineering and the Associate Director of the Concordia Institute for Aerospace and
Design Innovation (CIADI). Previously, she worked as Assistant Professor at Queens
Universitys School of Business and as a Lecturer at McGills Department of Management
Science for several years. Her research areas are mainly in operations management and quality 687
assurance, with a focus on new product development processes, and emerging tools and
techniques for integrating design and manufacturing to improve process performance.
Amit Baghel recently graduated from the Department of Mechanical and Industrial
Engineering at Concordia University. His research involved building models for Continuous
Improvement implementation. He holds a Bachelors degree in Industrial Engineering and is a
member of the American Society for Quality. He is a corresponding author and can be contacted
at: amitbaghel@hotmail.com
Jim Wilson holds a Bachelor of Commerce degree in Marketing from Concordia University in
Montreal, Canada and an MBA in International Business from McGill University also in
Montreal, Canada. Currently, Mr Wilson is a General Manager at Pratt and Whitney Canada and
is involved in training and implementing continuous improvement initiatives in organizations
throughout North America, Europe, Asia and in Africa. He is a corresponding author and can be
contacted at: Jim.Wilson@pwc.ca

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