chapter 14 quality management sell good merchandise at a reasonable profit, treat your customers...

Chapter 14Quality Management

Sell good merchandise at a reasonable profit, treat your

customers like human beings, and they will always come back for more. - Leon Leonwood Bean

2000 by Prentice-Hall, IncCh 3 - 2© 2000 by Prentice-Hall Inc

Russell/Taylor Oper Mgt 3/e

What Is Quality?

“The degree of excellence of a thing” (Webster’s Dictionary)

“The totality of features and characteristics that satisfy needs” ( ASQC)

Fitness for use

2000 by Prentice-Hall, IncCh 3 - 3© 2000 by Prentice-Hall Inc

Russell/Taylor Oper Mgt 3/e

Dimensions Of Product Quality (Garvin)

Performance

Features

Reliability Conformance

Durability

Serviceability Aesthetics

Safety

Other perceptions

2000 by Prentice-Hall, IncCh 3 - 6© 2000 by Prentice-Hall Inc

Russell/Taylor Oper Mgt 3/e

Service Quality

Time & Timeliness

Completeness

Courtesy

Consistency

Accessibility & Convenience

Accuracy

Responsiveness

2000 by Prentice-Hall, IncCh 3 - 8© 2000 by Prentice-Hall Inc

Russell/Taylor Oper Mgt 3/e

Quality Of Conformance – the way the producer or service provider sees it

Ensuring product or service produced according to design

Depends ondesign of production processperformance of machinerymaterialstraining

2000 by Prentice-Hall, IncCh 3 - 10© 2000 by Prentice-Hall Inc

Russell/Taylor Oper Mgt 3/e

Quality Philosophers

Walter Shewhart W. Edwards Deming Joseph Juran Philip Crosby Armand Feigenbaum

2000 by Prentice-Hall, IncCh 3 - 14© 2000 by Prentice-Hall Inc

Russell/Taylor Oper Mgt 3/e

Total Quality Management

1. Customer defined quality

2. Top management leadership

3. Quality as a strategic issue

4. All employees responsible for quality

5. Continuous improvement

6. Shared problem solving

7. Statistical quality control

8. Training & education for all employees

2000 by Prentice-Hall, IncCh 3 - 15© 2000 by Prentice-Hall Inc

Russell/Taylor Oper Mgt 3/e

TQM Throughout The Organization

Marketing, sales, R&D Engineering Purchasing Personnel Management Packing, storing, shipping Customer service How do you measure

quality for each of these functions?

2000 by Prentice-Hall, IncCh 3 - 17© 2000 by Prentice-Hall Inc

Russell/Taylor Oper Mgt 3/e

TQM In Service Companies

Inputs similar to manufacturingProcesses & outputs are differentServices tend to be labor intensiveQuality measurement is harderTimeliness is important measure

2000 by Prentice-Hall, IncCh 3 - 18© 2000 by Prentice-Hall Inc

Russell/Taylor Oper Mgt 3/e

Cost Of Quality

Cost of achieving good qualityPreventionAppraisal

Cost of poor qualityInternal failure costsExternal failure costs

2000 by Prentice-Hall, IncCh 3 - 22© 2000 by Prentice-Hall Inc

Russell/Taylor Oper Mgt 3/e

Quality Is...

An important determinant of business profitability

Positively & significantly related to higher return on investment

- The bottom line is profitability

2000 by Prentice-Hall, IncCh 3 - 23© 2000 by Prentice-Hall Inc

Russell/Taylor Oper Mgt 3/e

Quality And Productivity

Productivity = output / input

Fewer defects increase output

Quality improvement reduces inputs

2000 by Prentice-Hall, IncCh 3 - 35© 2000 by Prentice-Hall Inc

Russell/Taylor Oper Mgt 3/e

Employees & Quality Improvement

Quality circles

Employee suggestions

Process improvement teams

Self-managed work teams

2000 by Prentice-Hall, IncCh 3 - 37© 2000 by Prentice-Hall Inc

Russell/Taylor Oper Mgt 3/e

Seven Quality Control Tools

1. Pareto analysis

2. Flowcharts

3. Check sheets

4. Histograms

5. Scatter diagrams

6. Control charts

7. Fishbone diagram

2000 by Prentice-Hall, IncCh 3 - 38© 2000 by Prentice-Hall Inc

Russell/Taylor Oper Mgt 3/e

A Pareto Chart

Per

cent

fro

m e

ach

caus

e

Causes of poor quality

Mac

hine

cal

ibra

tions

Defec

tive

parts

Wro

ng d

imen

sions

Poor D

esig

n

Ope

rato

r erro

rsDef

ectiv

e m

ater

ials

Surfa

ce a

bras

ions

0

10

20

30

40

50

60

70(64)

(13)(10)

(6)(3) (2) (2)

2000 by Prentice-Hall, IncCh 3 - 39© 2000 by Prentice-Hall Inc

Russell/Taylor Oper Mgt 3/e

A Flowchart

2000 by Prentice-Hall, IncCh 3 - 40© 2000 by Prentice-Hall Inc

Russell/Taylor Oper Mgt 3/e

Check Sheet

COMPONENTS REPLACED BY LABTIME PERIOD: 22 Feb to 27 Feb 1998REPAIR TECHNICIAN: Bob

TV SET MODEL 1013

Integrated Circuits ||||

Capacitors |||| |||| |||| |||| |||| ||

Resistors ||

Transformers ||||

CommandsCRT |

2000 by Prentice-Hall, IncCh 3 - 41© 2000 by Prentice-Hall Inc

Russell/Taylor Oper Mgt 3/e

Histogram

0

510152025303540

1 2 6 13 10 16 19 17 12 16 20 17 13 5 6 2 1

2000 by Prentice-Hall, IncCh 3 - 42© 2000 by Prentice-Hall Inc

Russell/Taylor Oper Mgt 3/e

Scatter Diagram

.

2000 by Prentice-Hall, IncCh 3 - 43© 2000 by Prentice-Hall Inc

Russell/Taylor Oper Mgt 3/e

Control Chart

18

12

6

3

9

15

21

24

27

2 4 6 8 10 12 14 16

Sample number

Num

ber

of d

efec

ts

UCL = 23.35

LCL = 1.99

c = 12.67

2000 by Prentice-Hall, IncCh 3 - 44© 2000 by Prentice-Hall Inc

Russell/Taylor Oper Mgt 3/e

Fishbone Diagram

QualityProblem

MachinesMeasurement Human

ProcessEnvironment Materials

Faulty testing equipment

Incorrect specifications

Improper methods

Poor supervision

Lack of concentration

Inadequate training

Out of adjustment

Tooling problems

Old/worn

Defective from vendor

Not to specifications

Material-handling problems

Deficienciesin product design

Ineffective qualitymanagement

Poor process design

Inaccuratetemperature control

Dust and Dirt

2000 by Prentice-Hall, IncCh 3 - 45© 2000 by Prentice-Hall Inc

Russell/Taylor Oper Mgt 3/e

Quality Awards And Certifications

The Malcolm Baldrige Award The Deming Prize Industry, regional, and company awards

Institute of Industrial EngineersNASAEuropean Quality Award

2000 by Prentice-Hall, IncCh 3 - 46© 2000 by Prentice-Hall Inc

Russell/Taylor Oper Mgt 3/e

ISO 9000 Categories

ISO 9001 ~ Suppliers and Designers

ISO 9002 ~ Production

ISO 9003 ~ Inspection and Test

ISO 9004 ~ Quality Management

2000 by Prentice-Hall, IncCh 3 - 47© 2000by Prentice-Hall Inc

Russell/Taylor Oper Mgt 3/e

Implications Of ISO 9000

Truly international in scope Certification required by many foreign

firms U.S. firms export > $100 billion/yr to

Europe Adopted by U.S. Navy, DuPont, 3M,

AT&T, & others

2000 by Prentice-Hall, IncCh 3 - 48© 2000 by Prentice-Hall Inc

Russell/Taylor Oper Mgt 3/e

ISO Accreditation

European registration3rd party registrar assesses quality programEuropean Conformity (CE) mark authorized

United States 3rd party registrarsAmerican National Standards Institute (ANSI)American Society for Quality Control (ASQC)Registrar Accreditation Board (RAB)