Deutsche Allgemeinversicherung Case Solution And Analysis, HBR Case Study Solution & Analysis of Harvard Case Studies

Problem Diagnosis

The latest improvement and the process measurement technique called Statistical Process Control, has been implemented at DAV. Annete Kluck who is the head of operations development of the company was the one to introduce the company to this new concept to incorporate further improvements in the insurance industry. This case describes the implementation of SPC in a service industry and a range of tools such as the p- charts and the control charts were used to test SPC.

However, when the pilot process was initiated a range of challenges, problems and issues emerged. Such as the management was unaware of the accuracy rate for SPC and the employees had to work in a completely new environment. Frustrations were being caused by the sampling and the measurement process and it was becoming difficult to identify the bad and good work in the context of a legal department. Therefore, all the challenges need to be handled immediately so that the implementation of SPC in a service industry proves to be successful.

Analysis

If the implementation of SPC becomes successful at DAV then the burden of the data entry operators would be released and all the employees would be motivated to create an error free culture at DAV. The SPC would instill a new vision at DAV where all the employees would emphasize upon pure quality assurance. Analysis of the current SPC process has been performed below.

SPC Suitability in Service Industry & Implementation at DAV

The SPC concept has always been implemented in a manufacturing environment, however, it could be also be tailored to fit in a service industry environment however, many challenges will have to be overcome to make it a success. If the use of the SPC in both the industries is compared, then it could be seen that the measurement of SPC in a service industry is harder as compared to a manufacturing industry. This is also the case with DAV. Most of the operations of the service industry are not repeatable for instance, the back office operations. This makes it hard to measure the success of SPC in a service industry.

Furthermore, the staff of the company has to interact with the customers of the company from time to time, however, that interaction varies each time which makes it harder to implement SPC successfully. The workforce is the core asset and the value driver in a service industry and it is must for the employees to keep proper track about their objectives such as what to measure, how to measure, what are the minimum and the maximum control limits of the process etc. Control charts and P- charts resolve this issue to some extent however, the implementation of these tools in a service environment is more critical.Deutsche All gemeinversicherung Case Solution

The management of the company wants to successfully implement SPC at DAV because the accuracy numbers that have been quoted by the industry for DAV are incorrect therefore, the company wants to implement SPC to find about the true accuracy of the processes of the company. SPC has been identified as the next big thing for DAV and the head of operations department wants to make it a success for DAV to maintain the competitive position in the market.

Advantages & Disadvantages

There are many advantages as well as disadvantages for the implementation of SPC at DAV. The advantages are as follows:

More autonomy could be enjoyed by the employees and they are free to decide that what the most important thing to measure is and identify alternative approaches for getting the best possible outcomes.
A culture of error free environment is created within the organization and a standard is maintained which improves the efficiency and productivity of the overall operations.
Each employee gets a detailed checklist, which helps the employees to keep proper track of their performance and identify areas that need their most attention.

If we talk about the disadvantages then they are as follows:

If all the issues and challenges are not issues immediately, then the frustration level among the employees would increase significantly and the employees might think of SPC as a waste of time.

When the performance of individual employees is linked with the performance of the whole team they feel de-motivated and insecure and as a result they perform poorly......................

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