South-Western - Management  
Can Process Management Programs Actually Discourage Innovation
Topic Managing Manufacturing and Service Operations
Key Words Total Quality Management (TQM), Six Sigma, ISO 9000, process management
InfoTrac Reference A141294701
If your textbook came with an InfoTrac passcode, click here to login on InfoTrac.
News Story

Many businesses are still applying process management programs like Six Sigma, ISO 9000, and Total Quality Management (TQM) in their businesses even after two decades of popularity. Yet, Mary J. Benner, management professor for the Wharton School of Business at the University of Pennsylvania says these programs may need to be reevaluated and applied more discriminatingly. In her research done with Michael Tushman of the Harvard Business School, she has found that programs like these can diminish innovation.

According to Dr. Benner, the programs can be very helpful when used in the appropriate setting to help companies improve efficiency. However, when process management is applied in areas where innovation is important, measurement can crowd out new ideas.

TQM refers to a strategy in which an entire organization is focused on continuous improvement. It arose in the 1980s in response to Japanese competition and remained popular through the 9's. Six Sigma started at Motorola and gained popularity in the mid-1990s. The goal of Six Sigma is to improve a company's quality to only three defects per million through small changes in processes and careful statistical tracking of outcomes. Six Sigma emphasizes training experts (green belts and black belts) who work on solving problems while they train others at the company in the techniques.

ISO 9000, a program started in 1987 by the International Organization for Standardization, emphasizes that companies need to document what they do and do what they document. This program involves a third-party registration program that certifies that companies follow the precise documenting processes.

Dr. Benner believes that companies have used process management initiatives to reach the limits possible of improvement. Also, when everyone begins to use the techniques, the competitive advantages once gained are no longer there. Innovation becomes the only way a company can truly get ahead.

Dr. Brenner does not suggest dumping the process management principles altogether, but rather that organizations apply them where they are most appropriate. She and Tushman recommend that companies become "ambidextrous" -managing process management and innovation at the same time. Six sigma constraints, rules, and measurements might apply to one part of the business but not to others where innovation is taking place.

Questions
1.

What are the goals of process management programs?

2.

Name the top three process management programs and briefly describe how each is used.

3.

How do process management programs limit innovation?

4.

What approach to process improvement do Dr. Bennar and Tushman propose for U.S. manufacturing in the future?

Source "Can Process Management Programs Actually Discourage Innovation," Hydrocarbon Processing, January, 2006, page 23(2).
Instructor Discussion Notes Discussion Notes
These notes are restricted to qualified instructors only. Register for free!

Return to the Managing Manufacturing and Service Index

©2005  South-Western.  All Rights Reserved     |