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Achieving

Competitive

Excellence

The ACTS Operating System

Quality Manager: Willis Huang

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Non - Visible5-8 % of Sales

Visible2-3 % of Sales

Hidden?

The Cost of Poor Quality Iceberg

• Engineering Changes• Recurring Service Bulletins• Recurring Engineering Notices• Extra Set-ups• Long Cycle Times• Non-Contractual Warranty• Expediting Costs• Late Delivery Charges• Excess Inventory• Supplier Quality

Lost CredibilityLost Sales

Warranty, Scrap,Escapes, Rework,Repair, Extra Inspection

Lost Customer Loyalty

ACE Fosters a Quality Mindset

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Achieving Competitive Excellence to:provide products and services that are 100% defect-free.

do work that adds value to the company.

partner with customers and execute flawlessly, so they are delighted andkeep coming back.

be a great place to work!

Financial Performance

Quality Processes & Products

Employee Fulfillment

Customer Focus

ACE is the UTC operating system well adopted in ACTS

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What is an operating system?

… defines our daily management system… has three elements

culture ( “humanware” )set of tools ( hardware )competency

Achieving Competitive Excellence has,a Culture;a set of Tools; andthe Competency to implement the culture and the tools in everything that we do.

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Customer

ACE - Culture

Identify gaps & execute

RRCA

Define Metrics

Establish vision,

Strategy & goals

• Powered by the disciplined application of ACE tools for

Process improvement and waste elimination

Problem solving

Decision making

• Powered by the disciplined application of ACE tools for

Process improvement and waste elimination

Problem solving

Decision making

Monitor Progress

Customers define our Quality

Drives relentlessly to close gaps between actual results and goals.

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With ACE Culture we can…

Identifying opportunities to improve

Solving problems

Sustaining continuous improvement

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ACE – The Hardware

Process Improvement and Waste EliminationNew 5S (visual workplace) + Safety (6S)Value Stream Management Process Control & CertificationStandard WorkProduction Preparation Process (3P)Total Productive MaintenanceSet-up Reduction

Problem Solving (DIVE process)Market Feedback AnalysisQCPC (Quality Clinic Process Charts)Relentless Root Cause AnalysisMistake Proofing

Decision MakingPassport Process

The 12 ACE tools

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The Quality Model

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Description of 6S (UTC’s New 5S)

6S1. Safety

Prevent / control hazards

2. SortEliminate what is not needed

3. StraightenOrganize what remains

4. ShineClean work area

5. StandardizeSchedule cleaning and maintaining

6. SustainMake 6S a way of life

Creating workplace efficiency

Improving morale

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Drawer UnitAttached To

Machine

Items RequiredFor NormalOperation

6S Establishes the Foundation forWorkplace Organization

Point-of-useTooling

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A roadmap to quality products and processes

Definition of Quality Clinic Process Charts(QCPC)

QCPC encompasses a simple tool used to

continuously analyze a process for quality

improvement opportunities and process

inefficiencies, called “turnbacks”.

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What Are QCPC Turnbacks?

Any situation that hinders the flow of work. Turnbacks include any inefficiency in the process.

For example:Priority and plan changes

Re-design / Re-work / Re-do

Miscommunication

Incorrect data and information

Equipment and computer problems

Software discrepancies

Reporting turnbacks gives all employeesa voicein process improvement

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Determine yourgreatest opportunity

Map process andidentify turnback points

Apply an ACEProblem Solving Strategy

to investigate andeliminate root cause

PPDP(Detail Level Map)

PMT / IPT

Engineering

ConfigurationManagement

Producer

Assy & Test

Quality

Collect and summarizeturnback data at

established intervals

How QCPC Works

Total

Step 1 Step 2 Step 3 Step 4 Step 5 Step 6

Week 1

Week 2

Week 3

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Definition of Relentless Root Cause Analysis (RRCA)

The rapid and persistent pursuit of the

fundamental breakdown or failure of the

process that, when resolved, prevents a

recurrence of the problem.

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How RRCA Works

Utilizes a variety of strategies and tools to:

Define the problem,

Investigate probable root causes,

Verify what is the actual cause, and

Ensure a mistake-proof solution.

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Definition of Mistake Proofing

Using wisdom and ingenuity to

provide methods and devices that

allow you to do your job 100%

defect-free, 100% of the time.

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Criteria for Effective Mistake Proofing

Minimal cost

Simple to use

Easy to install

Durable

Easy to maintain

Does not hinder operator / user

Foolproof

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ACE - Competency

Competency is built through

Education

- Ito University

- ACE training

- Operations Transformation Leader curriculum

- High-impact ACE teams

- Doing: experience in many improvement activities

Sharing of best practices - Benchmark

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Levels of ACE Competency

Improved Performance

Step-change in Business Performance

Baseline• Customer expectations quantified• Performance baselines and gaps identified• Savings demonstrated from waste eliminations

• Measurable improvements in key customer deliverables achieved• Business results positively impacted • Significant business performance improvement targets set for Silver

• Business performance targets for Silver sustained• Stretch business performance goals set for Gold

Delighted Stakeholders• Best-in-class customer

satisfaction and businessperformance

ACE Silver

ACE Gold

ACE Bronze

ACE Qualifying

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ACTS Performance Trend

Performance

0

5

10

15

20

25

2003 2004 2005 2006 2007 2008 PlanYear

02004006008001000120014001600

SalesEscape PPM

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Summary

ACE is a continuing journey

The ACE Elements are the foundation

ACE provides powerful strategies and tools to improve business results

ACE uses achievement levels to recognize quality improvements and business results

ACE can involve and empower every employee

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Thank You!

Quality Manager: Willis Huang