lc5 quality management

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9-1 Management of Quality

CHAPTER

5

Quality Management & TQM

McGraw-Hill/Irwin

Operations Management, Eighth Edition, by William J. StevensonCopyright 2005 by The McGraw-Hill Companies, Inc. All rights reserved.


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Quality Management What does the term quality mean?

Quality is the ability of a product or service to

consistently meet or exceed customer

expectations.


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Key Contributors to Quality ManagementContributor

Deming

Juran

Feignbaum

Crosby

Ishikawa

Taguchi

Known for

14 points; special & common causes of

variation

Quality is fitness for use; quality trilogy

Quality is a total field

Quality is free; zero defects

Cause-and effect diagrams; qualitycircles

Taguchi loss function

Quality

Table 9.2


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Dimensions of QualityPerformance - main characteristics of theproduct/service

Aesthetics - appearance, feel, smell, taste

Special Features - extra characteristics

Conformance - how well product/serviceconforms to customers expectations

Reliability - consistency of performance


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Dimensions of Quality (Contd)Durability - useful life of the product/service

Perceived Quality - indirect evaluation ofquality (e.g. reputation)

Serviceability - service after sale


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Examples of Quality DimensionsDimension

1. Performance

2. Aesthetics

3. Special features

(Product)Automobile

Everything works, fit &finish

Ride, handling, grade ofmaterials usedInterior design, soft touch

Gauge/control placementCellular phone, CD

player

(Service)Auto Repair

All work done, at agreedprice

Friendliness, courtesy,Competency, quicknessClean work/waiting area

Location, call when readyComputer diagnostics


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Examples of Quality Dimensions (Contd)Dimension

5. Reliability

6. Durability

7. Perceived

quality

8. Serviceability

(Product)Automobile

Infrequency of breakdowns

Useful life in miles, resistance

to rust & corrosion

Top-rated car

Handling ofcomplaints and/orrequests for information

(Service)Auto Repair

Work done correctly,

ready when promised

Work holds up over

time

Award-winning service

department

Handling of complaints


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Service Quality

Tangibles Convenience

Reliability

Responsiveness

Time

Assurance

Courtesy


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Examples of Service Quality

Dimension Examples

1. Tangibles Were the facilities clean, personnel neat?

2. Convenience Was the service center conveniently located?

3. Reliability Was the problem fixed?

4. Responsiveness Were customer service personnel willing and able

to answer questions?

5. Time How long did the customer wait?

6. Assurance Did the customer service personnel seem

knowledgeable about the repair?

7. Courtesy Were customer service personnel and the

cashierfriendly and courteous?

Table 9.4


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Determinants of Quality

Service

Ease of

use

Conforms

to design

Design

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Determinants of Quality (contd)

Quality of design Intension of designers to include or exclude

features in a product or service

Quality of conformance The degree to which goods or services

conform to the intent of the designers

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Top management Design

Procurement

Production/operations Quality assurance

Packaging and shipping

Marketing and sales Customer service

Responsibility for Quality

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Quality Awards

Baldr ige Award

Deming Prize

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Malcolm Baldrige National Quality Award 1.0 Leadership (125 points)

2.0 Strategic Planning (85 points)

3.0 Customer and Market Focus (85 points)

4.0 Information and Analysis (85 points)

5.0 Human Resource Focus (85 points)

6.0 Process Management (85 points)

7.0 Business Results (450 points)

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Benefits of Baldrige Competition

Financial success Winners share their knowledge

The process motivates employees

The process provides a well-designed qualitysystem

The process requires obtaining data

The process provides feedback

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The Deming Prize Honoring W. Edwards Deming

Japans highly coveted award

Main focus on statistical quality control

Deming 14 points for Q

9 17 Management of Quality


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Quality Certification

ISO 9000:The International Organization for Standardization

(ISO)

Set of international standards on quality

management and quality assurance, critical to

international business

ISO 9000 Certification

First party certificationA firm audits itself.

Second party certificationCustomers audit their suppliers.

Third party assessmentCompany is assessed by outside

registrars from ASQs Registration Accreditation Board (RAB).

ISO 9000/Q90 Registration Process

Application to registrar, Preliminary assessment, Full audit



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ISO 14000 - A set of international standardsfor assessing a companys environmental

performance

Standards in three major areas Management systems

Operations

Environmental systems

ISO 14000



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Total Quality Management

A philosophy that involves everyone in anorganization in a continual effort to improve

quality and achieve customer satisfaction.

T Q M



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1. Find out what the customer wants2. Design a product or service that meets or

exceeds customer wants

3. Design processes that facilitates doing thejob right the first time

4. Keep track of results

5. Extend these concepts to suppliers

The TQM Approach



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Elements of TQM Continual improvement Competitive benchmarking

Employee empowerment

Team approach Decisions based on facts

Knowledge of tools

Supplier quality Champion

Quality at the source

Suppliers



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Quality at the Source

The philosophy of making each

worker responsible for thequality of his or her work.



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Lack of: Company-wide definition of quality

Strategic plan for change

Customer focus Real employee empowerment

Strong strong motivation

Time to devote to quality initiatives

Leadership

Obstacles to Implementing TQM



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Poor inter-organizational communication View of quality as a quick fix

Emphasis on short-term financial results

Internal political and turf wars

Obstacles to Implementing TQM



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Criticisms of TQM

Blind pursuit of TQM programs Programs may not be linked to strategies

Quality-related decisions may not be tied to

market performance Failure to carefully plan a program



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Basic Steps in Problem Solving1. Define the problem and establish animprovement goal

2. Collect data

3. Analyze the problem

4. Generate potential solutions

5. Choose a solution

6. Implement the solution

7. Monitor the solution to see if it accomplishesthe goal



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Six Sigma

Statistically

Having no more than 3.4 defects per million

Conceptually

Program designed to reduce defects

Requires the use of certain tools and techniques

Goals of Six Sigma

To reduce process variation to the point where only 3.4 defects per million are

produced by a process that involves a high volume of manufactured units or

service transactions on a continuous basis.

Provide a framework and methodologies to analyze and evaluate business

processes and reduce waste.

Successful Implementation

Training and selection of the workforce

Impressive cost savings of program



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Six Sigma Programs

Six Sigma programs Improve quality

Save time

Cut costs Employed in

Design

Production

Service

Inventory management

Delivery



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Six Sigma Management-Formula

1,000,00x

unitsofNo.x

unit

pererrorforiesopportunitofNumber

defectsofNumber

DPMO

Six Sigma allows managers to readily describe process performance using a

common metric: Defects Per Million Opportunities (DPMO)



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Six Sigma Process

Define-Customers and their priorities Measure-Process and its performance

Analyze-Causes of defects

Improve-Remove causes of defects Control-Maintain quality

DMAIC



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g f Q y

7 Basic Tools

Flow Chart Check Sheet

Histogram

Pareto Chart Scatter Diagram

Cause & Effect Diagram

Statistical Process Control

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