Project-Oriented Process Improvement

Li and Rajagopalan (1997; 1998) explored how improvements in operational process performance resulted from a combination of deliberate and autonomous learning. Deliberate (process) improvements resulted from the receipt of non-conforming parts with autonomous learning taking place as a function of the number of parts produced. The rate of improvement was modelled as an exponentially decreasing function, where it was necessary to continually increase process improvement effort to account for diminishing returns on effort. Zangwill and Kantor (1998) effectively addressed this issue, but developing a differential equation that related realised improvements to the potential for improvement. Rather than returns diminishing overtime, the effectiveness of managerial interventions could be assessed irrespective of whether improvement represented low hanging fruit or required more effort for improvements. Zangwill and Kantor (1998) also linked the PDCA cycle to management’s ability to review completed improvements to inform subsequent improvements, which was outlined as enabling continuous improvement.

Mukherjee et al.’s (1998) explicitly project oriented approach conceptualised the PDCA cycle as the conceptual and operational learning cycle of Kim (1993; cited in Mukherjee

et al. 1998). While focusing attention within a single company, the work provided an

valuable framework for viewing the knowledge based outcomes of improvement projects and how the use of quality management tools could promote learning and support the adaptation of future behaviour (Mukherjee et al. 1998, pS43). Mukherjee et al. (1998) stated how conceptual learning could assist in breaking path dependencies that can limit a firm’s ability to change over time and even recognising the need to change (Argyris 1977a).

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The explicit project orientation of Six Sigma that builds upon existing research on quality management makes it particularly relevant for researching process improvement. Motorola developed the approach in 1985 to focus improvements on the pursuit of challenging goals via the application to a structured methodology by highly trained practitioners (Harry and Schroeder 2000). While the popular press reported on a number of companies who have realised significant gains from the implementation of Six Sigma, such as General Electric and Allied Signal (Bossidy and Charan 2002), other companies have experienced problems during implementation. Consequently it has been necessary to research Six Sigma practices from a number of different perspectives, compared to simply looking at the tools it employs (Linderman et al. 2006).

Consistent with the focus of the current research to draw from organisational theory to provide a strong theoretical underpinning to the research, particular research on Six Sigma has taken a similar approach. Linderman et al. (2003) used a goal theoretic perspective to explore aspects of Six Sigma that appeared to promote improved project- level performance. Training was identified as a central aspect for reducing task complexity and developing goal commitment, which in turn enabled individuals to pursue challenging goals (Linderman et al. 2003, p.197). Linderman et al. (2003) presented research using alternative theoretical lenses as important avenues for further research. Linderman et al. (2006) later demonstrated that challenging goals, when combined with the effective use of Six Sigma methods, improved project performance. Within Linderman et al. (2006), goal theory provided “a foundation for developing scientific

knowledge about Six Sigma” (Linderman et al. 2003, p.193). Goal theory was extended

by Choo (2011), who found that goals defined in terms of problem resolution compared to quantitative performance improvement targets (e.g. “attain 70% reduction in defects” p.87) were more strongly related to knowledge creation.

While goal theory provided a useful theoretical lens to explore motivation within process improvement projects, overly challenging goals were found to reduce motivation (Linderman et al. 2006). Choo et al. (2007a) explored how the development of an organisational context (culture) that supported risk taking could reduce this problem and support practitioners in pursuing challenging goals and solve complex organisational

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problems. Building upon Mukherjee et al. (1998), knowledge was considered a critical output of improvement projects. While organisational context was found to be important for the exploration of complex problems, the structured method of Six Sigma was found to be important for solving problems efficiently (Choo et al. 2007a). Choo et al. (2007b) confirmed this finding empirically, demonstrating that adherence to the structured method led to improvements in learning behaviour. Psychological safety, related to individuals’ willingness to take risks during problem solving, related to the extent of knowledge that was created by a project. In combination, Choo et al. (2007b) found that both learning behaviour and knowledge creation directly impacted on the performance of improvement projects.

In addition to the exploration of process improvement within the context of Six Sigma enabling the accumulation of scientific knowledge in relation to goal theory and knowledge creation, aspects of the methodology have also been explored theoretically. Schroeder et al. (2008) employed “field observation, the literature and... pure thought” (p.537) to develop definitions and identify the underlying theory of Six Sigma. Organisational structure, improvement specialists, structured method and focus on performance metrics were found to be central to what constituted Six Sigma, broadly consistent with Zu et al. (2008). The attention on training combined with policies put in place to provide process improvement specialists with a structured career path created a foundation that sustained improvement activities. Anand et al. (2009) explored this aspect of Six Sigma further, demonstrating that process improvement infrastructure could enable firms to continually adapt to their operating environment, through the development of dynamic capabilities . Dynamic capabilities are specific and identifiable processes that support firms in proactively meeting changing requirements of their operating environment (Teece et al. 1997; Eisenhardt and Martin 2000).

Again building upon Mukherjee et al. (1998), but also Linderman et al. (2003; 2006), Anand et al. (2010) conducted a finer-grained assessment of the impact of particular quality management tools on knowledge creation. Different quality management tools were related to different quadrants of the knowledge creation cycle presented by Nonaka (1994). Rather than process improvement practices not being related

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to firm performance as presented by Powell (1995) and Samson and Terziovski (1999), quality tools promoted knowledge creation which in turn contributed to quality (Teece et

al. 1997)performance (Choo et al. 2007b). While confirming the role of knowledge and

learning within the context of Six Sigma has been important for accumulating scientific knowledge about Six Sigma, exploratory research into other aspects of Six Sigma has still been necessary.

Chakravorty (2009b), drawing from Schroeder et al. (2008), identified a number of practices that assisted in the successful implementation of Six Sigma. While providing additional support for Schroeder et al. (2008), Chakravorty (2009b) was unable to provide new perspectives, and without effectively drawing from theory, the research could not be considered cumulative. Chakravorty’s (2009a) other case-based research provided considerably more insight, by exploring the role of escalation theory in a failed Six Sigma initiative. Chakravorty (2009a) highlighted the problems associated with the escalation of commitment for improvement initiatives, combined with the need to strategically align improvement projects. Zhang et al. (2008) empirically demonstrated the importance of strategically aligning improvements, finding strategic alignment of projects had a stronger relationship with performance compared to the adherence to a structured methodology.

In summary, Six Sigma is a well-defined approach to process improvement that provides structure and definitions on which to base further research into process improvement. The structure of Six Sigma also provides a framework for more general process improvement practices. However, although firms pursuing Six Sigma will carry out process improvement, firms carrying out process improvement need not be pursuing Six Sigma (adapted from Powell 1995, p.31). While process improvement practices may not be supported by formal organisational infrastructure, have a structured methodology or be undertaken by highly trained professionals, process improvement may still play an important role in how firms choose to compete. From the previously presented literature, the following section presents a number of definitions to assist in further understanding how process improvement is currently conceptualised.

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