UNDERSTANDING VARIATION IN PERFORMANCE LEADS TO BUSINESS IMPROVEMENT David Pickton Michael Starkey Martin Bradford Leicester Business School, De Montfort University Abstract Statistical Process Control (SPC) is a concept and technique that can be harnessed to understand variations in business performance and lead to significant business improvement. Unfortunately, SPC is often perceived as a somewhat frightening term which belies its power to generate real improvement in all areas of management. In both the commercial and academic communities throughout Europe it is misunderstood and its potential hardly recognised. At best it has tended only to be applied to the ‘shop floor’ and for monitoring and control purposes. Its greatest impact, however, lies in its ability to create business improvement through focused and directed management effort. Recent contact with a number of companies in the UK who were already using SPC revealed, unsurprisingly, that they shared a number of common problems. In isolation, each was trying to solve these problems using SPC approaches. A suggestion was put forward for these companies to come together and share their experiences to the mutual benefit of all. And so, in 1995, the SPC User Network was formed which brought together interested parties and experts in the field of SPC. Their first meeting was held at De Montfort University, Leicester in September 1995 where the primary aim of the Network was identified as “the sharing of tactics and knowledge of SPC to benefit members and to convince and convert others”. Representatives from 3M Health Care, Training for Excellence, Rousell Laboratories, Napp Pharmaceuticals, Avery Berkel, Rover Finance, National Westminster Bank, Amersham International, National Blood Service, British Library, tMSc, Racal, Leicester Quality Centre and De Montfort University were all in attendance. The delegates were in total agreement on how fundamental SPC is to management and business improvement if properly applied. Concern, however, was expressed that many aspects of SPC are misunderstood and misapplied with too great an emphasis on control and insufficient emphasis upon improvement issues. During the meeting, as delegates outlined their own activities, the power, relevance and impact of SPC became clear. There were no doubts of the value of SPC in generating business improvement resulting in better working practices, customer and employee satisfaction and financial gains to the organisations involved.