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Individual Examination: British Telecom
Cape Town
CONTENTS
1 Executive Summary
On the surface it would appear that British Telecom has addressed each area of
TQM in their effort to implement a QMS system.
They have had good financial results. Their people/staff satisfaction is high. Their customer satisfaction index high and are termed “loyal”.
What really happened was that they had not implemented TQM correctly. In their attempt to focus on the customer they had neglected their staff. During Project
Sovereign BT lost 130 000 staff members. This may have been because the strategy and vision was not shared with all the staff. The outcome was however that they probably lost many good people.
The main component that was missing from their TQM implementation was Systems
Thinking. They did not implement a system that allowed issues which required improvement to become new projects. Thus even though they claimed they were continuously improving, there were very few new initiatives.
Prepared by: Deon du Plessis
Page 2 of 19
Created on 04/04/15 Individual Examination: British Telecom

Individual Examination: British Telecom
The solution will be to become a true BSPM learning organisation. This will involve some more changes to the structure where the continuous improvement projects will be programme managed across the value chain.
2 Question1: What role has the Quality Management system and the ISO 9001 standard played in BT’s total quality journey?
If one looks at the ideal QMS system as portrayed in Figure 4 then one will see that
BT have implemented major parts of the QMS system from the time that they decided to implement TQM in 1986.
2.1 The timelines of major QMS milestones.
1984: Privatise.
1986: Decide to implement TQM and announce a value system.
Involving everyone workshops held.
Train the managers via the Leadership Programme (employee involvement). 1991: Project Sovereign Restructure (customer focus).
Prepared by: Deon du Plessis
Page 3 of 19
Created on 04/04/15 Individual Examination: British Telecom of 19

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Ìndividual Examination: British Telecom Prepared by: Deon du Plessis Page 1 of 20 Created on Thursday, 15 September 2011 O Ìndividual Examination: British Telecom Name : Deon du Plessis Student ÌD : 6805105201087 Lecturers name : Professor Pieter Steyn Due Date : 13 May 2010 Unit title : Advanced Diploma in Project Management ÷ M3 Ìndividual assignment : : British Telecom Ì, the undersigned Deon du Plessis, hereby declare this assignment to be my own work. Ìt has not previously been submitted for any other examination¨ Deon du Plessis 28 th of April 2010 Cape Town Ìndividual Examination: British Telecom Prepared by: Deon du Plessis Page 2 of 20 Created on Thursday, 15 September 2011 O Ìndividual Examination: British Telecom CONTENTS 1 EXECUTIVE SUMMARY .................................................................................... 3 2 QUESTION1: WHAT ROLE HAS THE QUALITY MANAGEMENT SYSTEM AND THE ISO 9001 STANDARD PLAYED IN BT'S TOTAL QUALITY JOURNEY? 4 2.1 The timelines of major QMS milestones. ..............................................................................................4 2.2 Customer Focus.....................................................................................................................................7 2.3 Employee Involvement and Empowerment ..........................................................................................8 2.4 Continuous improvement......................................................................................................................8 2.5 Systems thinking ...................................................................................................................................8 3 QUESTION2: EVALUATE THE DEPLOYMENT OF THE TQM/BUSINESS EXCELLENCE MODEL IN BT. .................................................................................. 9 3.1 Deming cycle not followed correctly. .................................................................................................. 10 3.2 Balance Score Card (BSC) not integrated into QMS ......................................................................... 10 3.3 Assessments. ........................................................................................................................................ 11 3.4 Not all the staff were involved in BEM. .............................................................................................. 11 3.5 KPI and CSF`s not integral to BEM workshops. ............................................................................... 11 3.6 No programme management in place. ................................................................................................ 12 3.7 Problems with self assessment. ........................................................................................................... 12 3.8 Policy and strategy not communicated clearly. .................................................................................. 12 4 QUESTION3: HOW COULD BT HAVE IMPROVED IT'S UNDERSTANDING OF THE SUCCESS OF THE TQM/BUSINESS EXCELLENCE APPROACH? ....... 14 Ìndividual Examination: British Telecom Prepared by: Deon du Plessis Page 3 of 20 Created on Thursday, 15 September 2011 O Ìndividual Examination: British Telecom 4.1 Implement QMS according to the figure below. ................................................................................. 15 4.2 Set up the continuous improvement programme office. ..................................................................... 16 4.3 Appoint a New Chief Programme Officer (CPO) ............................................................................... 17 CONCLUSION.................................................................................................. 18 6 REFERENCES ................................................................................................. 19 1 Executive Summary On the surface it would appear that British Telecom has addressed each area of TQM in their effort to implement a QMS system. They have had good financial results. Their people/staff satisfaction is high. Their customer satisfaction index high and are termed "loyal¨. What really happened was that they had not implemented TQM correctly. Ìn their attempt to focus on the customer they had neglected their staff. During Project Sovereign BT lost 130 000 staff members. This may have been because the strategy and vision was not shared with all the staff. The outcome was however that they probably lost many good people. The main component that was missing from their TQM implementation was Systems Thinking. They did not implement a system that allowed issues which required improvement to become new projects. Thus even though they claimed they were continuously improving, there were very few new initiatives. The solution will be to become a true BSPM learning organisation. This will involve some more changes to the structure where the continuous improvement projects will be programme managed across the value chain. Ìndividual Examination: British Telecom Prepared by: Deon du Plessis Page 4 of 20 Created on Thursday, 15 September 2011 O Ìndividual Examination: British Telecom 2 Question1: What roIe has the QuaIity Management system and the ISO 9001 standard pIayed in BT's totaI quaIity journey? Ìf one looks at the ideal QMS system as portrayed in Figure 4 then one will see that BT have implemented major parts of the QMS system from the time that they decided to implement TQM in 1986. 2.1 The timeIines of major QMS miIestones. 1984: Privatise. 1986: Decide to implement TQM and announce a value system. Ìnvolving everyone workshops held. Train the managers via the Leadership Programme (employee involvement). 1991: Project Sovereign Restructure (customer focus). Ìndividual Examination: British Telecom Prepared by: Deon du Plessis Page 5 of 20 Created on Thursday, 15 September 2011 O Ìndividual Examination: British Telecom 1992: Business Excellence model & self assessment: 1993: Project Breakout (continuous improvement). 1994: ÌSO 9001 certified (systems thinking). ÌSO 14001 certified. Ìnvestors in People (ÌiP) certified. 1995: Balance Score Card adopted. Ìndividual Examination: British Telecom Prepared by: Deon du Plessis Page 6 of 20 Created on Thursday, 15 September 2011 O Ìndividual Examination: British Telecom To answer the question regarding what role the Quality Management system played in British Telecom's Quality journey each of the pillars of TQM will be looked at and measured against the following statement from the case study "Ìn 1986 BT chose total quality management as a means of focusing on customer requirement as well as encouraging teamwork, a positive attitude towards probIem soIving and a commitment to continuous improvement.¨ The four pillars of TQM are: O Customer Focus O EmpIoyee InvoIvement and Empowerment O Continuous Improvement O Systems Thinking From the above it is evident that in British Telecom's statement regarding quality, each of the four pillars are reflected. Three of the TQM pillars are also reflected in the new values that British Telecom deployed, namely: O We put our customers first. O We are professionaI. O We respect each other. O We work as one team. O We are committed to continuous improvement. Ìndividual Examination: British Telecom Prepared by: Deon du Plessis Page 7 of 20 Created on Thursday, 15 September 2011 O Ìndividual Examination: British Telecom 2.2 Customer Focus Ìt is said that the overriding objective of a TQM philosophy is customer satisfaction. The first pillar of TQM being "Customer Focus¨ also became British Telecom's primary focus in their drive towards Quality. Customer focus became the driver and according to David Thomas, Head of Change Management, British Telecom, the great restructuring program that British Telecom embarked on in 1991 was called "Project Sovereign¨ for the main reason that the Customer needed to be "king¨. The case study also states that "the company organization was completely redesigned "to put customers first.¨¨ Thus "Project Sovereign¨ was born out of TQM and the company was split into three customer segmented business units, Business Division, Customer Division and Global Division. They also formed a Networks and Systems infrastructure support division. Project Sovereign was a radical transformation project which ended up reducing the number of staff by more than 50%.( roughly from 250 000 down to 120 000). This is also in line with TQM, since it is stated that "value chain performance quality is profoundly dependent on right-sizing human talent¨. British Telecom was a state owned bureaucratically run organisation that was overstaffed thus also making salaries a wastefully large proportion of their operating expenditure. When Telkom was privatised, it too gradually reduced the people component from over 60 000 in 1990 down to just over 20 000 today. For Telkom the salary bill was more than 70% of its operating expense when the company was formed which is a major burden on any organisation and way out of the norm which is about 20%. Ìndividual Examination: British Telecom Prepared by: Deon du Plessis Page 8 of 20 Created on Thursday, 15 September 2011 O Ìndividual Examination: British Telecom 2.3 EmpIoyee InvoIvement and Empowerment "Ìnvolving everyone¨ workshops were held as part of the new strategy to improve the knowledge of the staff as well as to build teams that are professional, respect one another and work as one team ÷ with the single minded focus on the customer. Leadership programmes were arranged for the managers to help them focus on putting the customer first. 2.4 Continuous improvement Project Breakout was launched in 1993 to focus on the continuous improvement pillar of TQM. As stated in the case study " This comprehensive review of key business processes provided improvements aimed at generating new revenue, growing markets, working more efficiently, delighting customers and running business process that would make BT more competitive¨. 2. Systems thinking Systems' thinking ensures that a system of measurement, appraisal and review is introduced into the organisation. British Telecom certified their process's ÌSO9001 which has the following benefits: O Registration to ÌSO 9001 by an accredited certification body shows committed to quality, customers, and a willingness to work towards improving efficiency. O Ìt demonstrates the existence of an effective quality management system that satisfies the rigours of an independent, external audit. O An ÌSO 9001 certificate enhances company image in the eyes of customers, employees and shareholders alike. Ìndividual Examination: British Telecom Prepared by: Deon du Plessis Page 9 of 20 Created on Thursday, 15 September 2011 O Ìndividual Examination: British Telecom O Ìt also gives a competitive edge to an organisation's marketing. Ìt is important to note that having ÌSO 9001 certification does not mean that the products or services are of the highest quality. Ìt does mean that there are process's in place that have been audited by an external body that registers the existence of proper quality plans, programs, documentation, data and procedures. British Telecom also introduced annual self assessment together with the Business Excellence Team that conducted workshops as a way of gathering feedback on the TQM process. This function was designed to conduct yearly workshops with the various business units and sub divisions to discuss issues related to quality. The Balanced Score Card was introduced "to translate British Telecom's strategy into action through a set of key objectives, measures and targets¨. ÌSO 14001 also certified British Telecom as environmentally responsible. 3 Question2: EvaIuate the depIoyment of the TQM/Business ExceIIence modeI in BT. Ìndividual Examination: British Telecom Prepared by: Deon du Plessis Page 10 of 20 Created on Thursday, 15 September 2011 O Ìndividual Examination: British Telecom 3.1 Deming cycIe not foIIowed correctIy. Figure 2. Ìn figure 1 above the famous Deming quality cycle of plan, do, check and then act is illustrated. When British Telecom deployed TQM/BEM they used their own method namely awareness, understanding and use. These deployment stages only address the pIan and the do phases of Deming's quality cycle. Thus the very important check and act which allows for correction, that can be viewed as continuous improvement has not been included in the British Telecom's Business Excellence model. The very important components of measuring and correction are thus not part of BT's TQM/BEM implementation model. This can be seen by the statement "BT finds it hard to assign directly cause and effect between TQM and business benefits¨. Ìn essence top management was rolling out the initiatives without getting feedback as to how the initiative was performing. 3.2 BaIance Score Card (BSC) not integrated into QMS The BSC was introduced into BT in 1995 after ÌSO9001 certification was attained in 1994. Even though CSF's and KPÌ's were defined and measure by management Ìndividual Examination: British Telecom Prepared by: Deon du Plessis Page 11 of 20 Created on Thursday, 15 September 2011 O Ìndividual Examination: British Telecom these measurements were not integrated into the QMS system. This is why BT found it difficult to "assign directly cause and effect between TQM and business benefits¨. 3.3 Assessments. Assessments are only done annually. This means that issues that may have been identified that could potentially become improvement projects will need to wait for the assessment to be done. Potentially there could be a one year delay from identification to the actual assessment. 3.4 Not aII the staff were invoIved in BEM. The case study mentions that when the TQM/BEM business model is deployed, then the roll out of "understanding¨ does not consistently go down to all the levels of management. The case study mentions that the roll out goes down to level four most of the time, meaning that levels five and six managers often do not get involved with the TQM initiative. 3. KPI and CSF's not integraI to BEM workshops. When the BEM team conduct yearly workshops with divisions the managers of those divisions are allowed to determine the agenda. The example given in the case study mentions that one manager wanted to discuss strategy at the workshop. What should be discussed are areas where improvement is required when the CSF's and KPÌ's are measured against set targets which would have been forthcoming from the BSC. Ìndividual Examination: British Telecom Prepared by: Deon du Plessis Page 12 of 20 Created on Thursday, 15 September 2011 O Ìndividual Examination: British Telecom Unless the correct measurements are discussed it is unlikely that continuous improvement projects will result from BEM projects. 3.6 No programme management in pIace. There is no evidence of a dedicated programme structure that would project manage any continuous improvement initiatives. Ìt would seem that the BEM department may be driving some of those initiatives. 3.7 ProbIems with seIf assessment. Self assessment is not the most honest type of measurement. There is the possibility that people would hide what is not right and only portray what is positive especially in the quest to be awarded one of the Gold awards. Thus issues may not be raised and if they are not raised, they will not be addressed and improvement in quality will not be forthcoming. Another issue with self assessment is that it is no longer compulsory. This proves that BT does not understand the value of the assessments since they are not using it for the correct purpose which is to feed back into the BSC. Since BT was also involved in the formulation of the EFQM standard, they may have ended up thinking that they know all about TQM and BEM and thus they do not need to continue enforcing assessments. This is why the assertion is made that BT does not have Systems Thinking instiIIed within the organisation. 3.8 PoIicy and strategy not communicated cIearIy. Ìndividual Examination: British Telecom Prepared by: Deon du Plessis Page 13 of 20 Created on Thursday, 15 September 2011 O Ìndividual Examination: British Telecom The company strategy is not clearly communicated since in the BEM workshop that was mentioned the manager wanted to talk about strategy. Ìndividual Examination: British Telecom Prepared by: Deon du Plessis Page 14 of 20 Created on Thursday, 15 September 2011 O Ìndividual Examination: British Telecom 4 Question3: How couId BT have improved it's understanding of the success of the TQM/Business exceIIence approach? BT could have taken the following actions and or plans to have improved the success of their TQM/BEM approach. Ìndividual Examination: British Telecom Prepared by: Deon du Plessis Page 15 of 20 Created on Thursday, 15 September 2011 O Ìndividual Examination: British Telecom 4.1 ImpIement QMS according to the figure beIow. Figure 1 (Adapted from Prof PG Steyn) Ìndividual Examination: British Telecom Prepared by: Deon du Plessis Page 16 of 20 Created on Thursday, 15 September 2011 O Ìndividual Examination: British Telecom As previously mentioned in this document, BT has most of the components of a Quality Management System in place. What they could have done better is to have implemented the components of the QMS system in the correct sequence. An example of their errors is only implementing the BSC card after many years and after ÌSO9001 certification. 4.2 Set up the continuous improvement programme office. Ìndividual Examination: British Telecom Prepared by: Deon du Plessis Page 17 of 20 Created on Thursday, 15 September 2011 O Ìndividual Examination: British Telecom Figure 3: BSPM System Schematic Prof Steyn states: "The BSPM system utilises Total Quality Management (TQM) principles inter alia having a focus on internal and external customer needs; involving management and staff at all levels of the organisation in team work; decentralising managerial decision-making; focusing on continuously improving the products, services, systems and processes of the organisation; and creating a learning organisation that stimulates human creativity and knowledge management. The progress reviews adopted in the BSPM system approach provides maximum flexibility, agility, innovation, monitoring and control. Coupled with leadership excellence it assures strategic organisational success¨ (Steyn P. G., 2003). Central to the BSPM system is creating high-performance integrated project and process teams that operate in a coordinated manner across functional boundaries within the organisation (Matrix Organisational Structure). The main benefits of a BSPM system are organisational effectiveness and efficiency (doing the right things and doing them right the first time). (Burke, 2009) Thus it is recommended that the model above be put into place. This model will become the vehicle to drive continuous improvement projects. Once the new structure is in place, this model will allow for continuous improvement to become part of the normal operational model of the company while being able to focus on the companies strategic objectives. 4.3 Appoint a Chief Programme Officer (CPO) For the organisation to succeed, the Chief Executive Officer (CEO) and the full staff complement need to be well versed in the principles of project and programme management. Steyn asserts that as programme offices in the organisational structure grow in numbers the need for an executive position where programme managers Ìndividual Examination: British Telecom Prepared by: Deon du Plessis Page 18 of 20 Created on Thursday, 15 September 2011 O Ìndividual Examination: British Telecom report increases (Steyn P. G., November 2009 (Vol XÌ, Ìssue XÌ)). Ìt is unthinkable that they all report to the CEO. Hence, it is recommended that a new CPO be appointed to significantly support the CEO, Chief Financial Officer (CFO) and Chief Operating Officer (COO) with strategic appraisals and reviews at the executive leadership level. ConcIusion A bad implementation of quality management is better than no having no quality management initiatives at all. Ìndividual Examination: British Telecom Prepared by: Deon du Plessis Page 19 of 20 Created on Thursday, 15 September 2011 O Ìndividual Examination: British Telecom 6 References . Kaplan, R. S. (1996). The Balanced Scorecard. Boston: Harvard University Press. Kaplan, R. S. (2001). The Strategy Focused Organisation. Harvard Business School Press Steyn, P. G. (2009). Module M1 - Project Management: Leading, Creating, Implementing and Improving (Study Guide). Cranefield College of Project and Programme Management. Steyn, P. G. (2009). Module M2 - Programme Managing Organisational Performance and Innovative Improvement (Study Guide). Cranefield College of Project and Programme Management. Steyn, P. G. (2006). Programme Managing Organisational Transformation, Change and Performance Improvement. unpublished beta copy. Steyn, P. G. (2003). The BSPM System for Leading and Managing the Organizational Value Chain. Moscow: Cranefield College of Project and Programme Management. Steyn, P. G. (November 2009 (Vol XÌ, Ìssue XÌ)). The Emergent Role of Chief Programme Officer (CPO). PM World Today . Steyn, V. (n.d.). Cranefied College of Project and Programme Management Module 1. Bibliography Burke, R. (2009). Project Management Techniques (College Edition). Burke Publishing. Clements, J. P. (2006). Effective Project Management (International Student Edition). Thompson South-Western, Canada. Clements/Gido. (2006). Effective Project Management. Ohio: Thomson South-Western. Kaplan, R. S. (1996). The Balanced Scorecard. Boston: Harvard University Press. Kaplan, R. S. (2001). The Strategy Focused Organisation. Harvard Business School Press. Kerzner, H. (1998). Project Management: A Systems Approach to Planning, Scheduling and Controlling (6th Edition). New York: John Wiley. Kotter, J. P. (1996). Leading Change. Boston: Harvard Business School Press. Kreitner, R. a. (2007). Organizational Behavior (7th Edition). Ìrwin McGraw-Hill. Lewin, K. (1997). Resolving Social Conflicts: Field Theory in Social Science. Washington DC: American Psychological Association. Multiplin (Director). (2007). Essential Perspective on Project Management [Motion Picture]. Multiplin (Director). (2007). Project Management Tools and Techniques [Motion Picture]. Ìndividual Examination: British Telecom Prepared by: Deon du Plessis Page 20 of 20 Created on Thursday, 15 September 2011 O Ìndividual Examination: British Telecom Partington, D. (2000). Gower Handbook of Project Management (3rd Edition). England: Gower Publishing. Steyn, P. G. (2009). Module M1 - Project Management: Leading, Creating, Implementing and Improving (Study Guide). Cranefield College of Project and Programme Management. Steyn, P. G. (2009). Module M2 - Programme Managing Organisational Performance and Innovative Improvement (Study Guide). Cranefield College of Project and Programme Management. Steyn, P. G. (2006). Programme Managing Organisational Transformation, Change and Performance Improvement. unpublished beta copy. Steyn, P. G. (2003). The BSPM System for Leading and Managing the Organizational Value Chain. Moscow: Cranefield College of Project and Programme Management. Steyn, P. G. (November 2009 (Vol XÌ, Ìssue XÌ)). The Emergent Role of Chief Programme Officer (CPO). PM World Today . Steyn, V. (n.d.). Cranefied College of Project and Programme Management Module 1. www.isoqar.com/iso9001/qualintro.htm
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...San Jose State University SJSU ScholarWorks Faculty Publications Management School 1-1-2009 Commonalities and differences between service and manufacturing supply chains: Combining operations management studies with supply chain management Ming Zhou San Jose State University, ming.zhou@sjsu.edu J. Yi. Saint Joseph's University, Philadelphia, PA T. Park San Jose State University Follow this and additional works at: http://scholarworks.sjsu.edu/org_mgmt_pub Part of the Business Administration, Management, and Operations Commons, and the Organizational Behavior and Theory Commons Recommended Citation Ming Zhou, J. Yi., and T. Park. "Commonalities and differences between service and manufacturing supply chains: Combining operations management studies with supply chain management" California Journal of Operations Management (2009): 136-143. This Article is brought to you for free and open access by the Management School at SJSU ScholarWorks. It has been accepted for inclusion in Faculty Publications by an authorized administrator of SJSU ScholarWorks. For more information, please contact scholarworks@sjsu.edu. Commonalities and Differences between Service and Manufacturing Supply Chains: Combining Operations Management Studies with Supply Chain Management Ming Zhou • Taeho Park San Jose State University, San Jose, CA John Yi Saint Joseph's University, Philadelphia, PA The service sector of the US economy has been gaining importance...

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