quality management an overview nicmar october 2007 1233776453127054 2

8/3/2019 Quality Management an Overview Nicmar October 2007 1233776453127054 2

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QUALITY MANAGEMENT

AN OVERVIEW

PEM 2007-09

NICMAROctober 2007


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One of the most important issues

that businesses have focused on inthe last 20-30 years has beenquality.

As markets have become muchmore competitive - quality hasbecome widely regarded as a key

ingredient for success in business.


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Meaning of Quality Websters Dictionary

degree of excellence of a thing

American Society for Quality

totality of features and characteristics thatsatisfy needs

Consumers and Producers Perspective


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This is a modern definition of quality


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This is a traditional definition

Quality of design

Quality of conformance


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What is quality? Quality is first and foremost about

meeting the needs andexpectationsof customers. It is important tounderstand that quality is about morethan a product simply "working

properly".


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QUALITY Quality is the ability of a product or service to

consistently meet or exceed customer

expectations. Quality is defined as meeting or exceeding

customers requirements now and in the

future, i.e. the product or service is fit for the

customers use.


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quality as representing all the

features of a product or servicethat affect its ability to meetcustomer needs.

If the product or service meets allthose needs - then it passes thequality test. If it doesn't, then it is

sub-standard.


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What is Quality?

Fitness for Use

Conformance to Specifications

Producing the Very Best Products Excellence in Products and Services

Total Customer Satisfaction

Exceeding Customer Expectations Quality improvement starts with reducing Product

VARIABILITY.


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1 What is Quality? Inspection (Detection)

Quality Control (Detection using statistics)

Quality Assurance (Prevention)

Zero Defects e.g. ISO 9001:2000 Total Quality Management

e.g. EFQM Excellence Model


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Statistical Quality Control (SQC) The application of statistical techniques to the

control of quality (SPC, Acceptance Sampling, etc.)

Statistical Process Control (SPC) The application of statistical techniques to the

control of processes (sometimes considered asubset of SQC)

Total Quality Management (TQM) An all-encompassing approach to quality

consistent with Demings 14 points

Some definitions-

Definitions fromDefinitions from Quality Systems TerminologyQuality Systems Terminology, American, American

Society forQuality Control, ANSI/ASQC A3Society forQuality Control, ANSI/ASQC A3--19871987


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Statistical Process Control How do we reduce Product Variability?

We use Statistical Process Control ! (SPC)

Statistical Process Control: The application of

statistical techniques to the control andimprovement of processes.


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Meaning of Quality:

Consumers Perspective Fitness for use

how well product orservice does what it issupposed to

Quality of design designing quality

characteristics into a

product or service A Mercedes and a Ford

are equally fit for use,but with differentdesign dimensions


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Dimensions of Quality:

Manufactured Products Performance

basic operating characteristics of a product; how

well a car is handled or its gas mileage

Features

extra items added to basic features, such as astereo CD or a leather interior in a car

Reliability probability that a product will operate properly

within an expected time frame; that is, a TV willwork without repair for about seven years


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Manufactured Products (cont.) Conformance

degree to which a product meets preestablished standards

Durability

how long product lasts before replacement

Serviceability

ease of getting repairs, speed of repairs,courtesy and competence of repair person


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Manufactured Products (cont.)Aesthetics

how a product looks, feels, sounds, smells,

or tastes Safety

assurance that customer will not sufferinjury or harm from a product; anespecially important consideration forautomobiles

Perceptions

subjective perceptions based on brandname, advertisin , and the like


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Service (cont.) Courtesy:

How are customers treated by employees?

Are catalogue phone operators nice andare their voices pleasant?

Consistency

Is the same level of service provided toeach customer each time?

Is your newspaper delivered on time everymorning?


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Service (cont.) Accessibility and convenience How easy is it to obtain service?

Does a service representative answer you calls quickly?

Accuracy Is the service performed right every time?

Is your bank or credit card statement correct everymonth?

Responsiveness How well does the company react to unusual

situations?

How well is a telephone operator able to respond to acustomers questions?


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Meaning of Quality:

A Final Perspective Consumers and producers

perspectives depend on each other

Consumers perspective: PRICE

Producers perspective: COST

Consumers view must dominate


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Fitness for

Consumer Use

Producers Perspective Consumers Perspective

Quality of Conformance

Conformance to

specifications Cost

Quality of Design

Quality characteristics

Price

MarketingProduction

Meaning of Quality

Meaning of Quality


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Quality Gurus Walter Shewart

In 1920s, developed control charts

Introduced the term quality assurance

W. Edwards Deming Developed courses during World War II to teach statistical

quality-control techniques to engineers and executives ofcompanies that were military suppliers

After the war, began teaching statistical quality control to

Japanese companies Joseph M. Juran

Followed Deming to Japan in 1954

Focused on strategic quality planning


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Quality Gurus (cont.) Armand V. Feigenbaum

In 1951, introduced concepts of total quality control andcontinuous quality improvement

Philip Crosby In 1979, emphasized that costs of poor quality far outweigh

the cost of preventing poor quality

In 1984, defined absolutes of quality managementconformance to requirements, prevention, and zero

defects Kaoru Ishikawa

Promoted use of quality circles

Developed fishbone diagram

Emphasized importance of internal customer


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Evolution of Quality

Management1924 - Statistical process control charts

1930 - Tables for acceptance sampling

1940s - Statistical sampling techniques

1950s - Quality assurance/TQC

1960s - Zero defects

1970s - Quality assurance in services


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The Quality Gurus Walter Shewhart

Father of statistical quality control

W. Edwards Deming Joseph M. Juran

Armand Feignbaum

Philip B. Crosby

Kaoru Ishikawa

Genichi Taguchi


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Key Contributors to QualityManagement

Contributor

Deming

Juran

Feignbaum

Crosby

Ishikawa

Taguchi

Known for

14 points; special & common causes ofvariation

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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The early 50s Three gurus who took the message to

Japan

Deming

Juran

Feigenbaum

Guru summaries adapted from Prof Tony BendellAvailable at:www.cems.uwe.ac.uk/~jmcobby/industrialstats/qualitygurus.pdfand from

http://www.qmtzone.f9.co.uk/html/guru.html


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DrW Edwards Deming

Deming (1900-1994) is arguably the most famous of all the

Quality Gurus and is often credited with Japan's rise to

industrial dominance.

He was born in 1900 and was awarded a doctorate in

mathematical physics in 1928 by Yale University.

His approach to quality draws heavily on Shewhart's concept

of statistical process control.

Deming's work had initially no impact in America primarily

because in the postwar booming market, everything built was

sold.


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DrW Edwards Deming

For many years at the start of his career he worked as a

statistician for the US Government Service, specialisingin statistical sampling techniques.

After the war, in 1946, he went to Japan as an Adviserto the Japanese Census. The Union of JapaneseScientists and Engineers (JUSE) invited him to lecture onquality control techniques to engineers and seniormanagers. His contribution to rebuilding the Japaneseeconomy was recognized by the Emperor who awardedhim the Second Order of the Sacred Treasure (Bendell,1991).


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DrW Edwards Deming

His main message to the Japanese was that variability is

inherent in any process and is due to two types of

causes, namely, special causes which are easily

assignable, identifiable and solvable by operators

themselves, and commoncauses which are due to

design and operation and only management can

eliminate. Deming argues that 94 per cent of the qualityproblems are the responsibility of management


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DrW Edwards Deming

Throughout the 1950s, Deming conducted manylectures in Japan on statistical methods.

Included in these lectures were many of theprinciples now constituting the "company-wide"approach or TQM.

Whilst much of Deming's message to the Japanesereflected his statistical background, his workextended far beyond statistical methods.


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DrW Edwards Deming

He encouraged the Japanese to adopt a systematicapproach to problem solving, later to becomeknown as the PDCA (Plan, Do, Check, Action) cycle.

He also urged senior managers to become moreactively involved in quality improvementprogrammes.

It was not until the 1970s that managers in theWest began to consider whether Deming's methodscould do for their companies what they had donefor the Japanese.


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DrW Edwards Deming

The PDCA cycle

PLAN

DOCHECK

ACT


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Dr Joseph Juran Born 1904 in the Balkans, naturalised

American

Went to Japan in the early 50s

Highly respected internationally,

particularly in Japan

Concerned with the wider aspects of

management, beyond quality


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Dr Joseph Juran Manufacturing-based approach

Introduced the concept of the internalcustomer

SeeKelemen p28 for his 8 step

planning map.


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Dr Joseph Juran Quality trilogy

Quality Control Quality Planning

Quality Improvement

Holding the gains

Breakthrough Pareto analysis

Project by project


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DrArmand Feigenbaum Two key texts:

Quality Control: Principles, Practice and

Administration1951 Total Quality Control: Engineering and

Management1961

Value-based approach

best for the customer use at the rightselling price (in Kelemen 2005 p29)


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DrArmand Feigenbaum Total quality:

Quality is neither a department, nor a

technique, nor a philosophy. It is afundamental way of managing. Central

to this is the recognition that, without

quality, your customersare simply notgoing to buy from you.

www.managementfirst.com/quality/interviews/feigenbaum


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DrArmand Feigenbaum Costing quality:

Prevention costs planning systems and

processes to avoid defects before theyhappen

Appraisal costs inspection and qualitycontrol

Internal failure costs scrap, rework

External failure costs warranty costs,complaints


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From the late 50s Three Japanese gurus who developed

the message

Ishikawa

Taguchi

Shingo




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Dr Kaoru Ishikawa Professor Ishikawa (1915-1989) studied Applied

Chemistry at the Engineering Department of Tokyo

University.

During his life he was awarded many prizes for his

work and writings on Quality Control and is best knownas the pioneer of the Quality Circle movement in

Japan during the 1960s.


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Dr Kaoru Ishikawa

Like many of the Japanese "gurus",Ishikawa was keen to promote the use of

statistical techniques in commerce andindustry.

In particular, Ishikawa believed that allemployees should have a basic training in

techniques such as:

* Bar Charts and Histograms* Pareto Analysis* Scatter Diagrams*

Cause and Effect Analysis


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Quality circles:

A voluntary group of some 5-10 workers from thesame workshop who meet regularly and are led by aforeman, assistant foreman, work leader or one of theworkers.

Their aim is to: contribute to the improvement and development of the

enterprise by dealing with problems and looking for ways toimprove the quality of the process and product

Respect human relations and build a happy workshop

offer job satisfaction via the drawing out of each personscapabilities to achieve their potential.

Dr Kaoru Ishikawa


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Dr Kaoru Ishikawa The Fishbone or Ishikawa diagram

Methods Equipment

Materials People

Result


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Dr Kaoru IshikawaAway from his technical contributions, Ishikawawas a strong advocate of the Company-Wide

movement.

He saw this approach as implying that:

"quality does not only mean the quality of the

product, but also of after-sales services,management, the company itself and the humanbeings who work in it".


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Dr Genichi Taguchi During the Second World War he worked in the

Navigation Institute of the Imperial Japanese

Navy and then the Institute of StatisticalMathematics at the Ministry of Education.

In 1950 he joined the Nippon Telephone and

Telegraph Company and during his 12 year staydeveloped many of his methods.


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Dr Genichi Taguchi In the early 1970s Taguchi developed the concept of

the "Quality Loss Function" and by the end of thatdecade was highly acclaimed in his own country.

It was not until 1980 that Western companies,particularly in the USA began to implement Taguchi'smethods. The most notable of these being Xerox, Fordand ITT.

Taguchi had made little impact in Europe until theInstitute of Statisticians organised a conference inLondon in 1987 to discuss his methods.


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Dr Genichi Taguchi

The UKTaguchi Club, (now the Quality Methods Association) wasformed later that year.

Taguchi's methodology is geared towards pushing the concepts ofquality and reliability back into the design stage, ie, prior tomanufacturing.

His method provides an efficient technique for designing product

tests prior to beginning manufacturing.

Taguchi methodology is fundamentally a prototyping technique thatenables engineers/designers to produce a robust design which cansurvive repetitive manufacturing in order to deliver the functionalityrequired by the customer.


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Shigeo Shingo Shigeo Shingo is the least known Japanese

quality writer in the West. His approachemphasizes production rather thanorganizational issues, and it is thusmanufacturing-based. He believed thatstatistical methods detect errors too late in the

manufacturing process.

Shingo's methodemphasises 'zero defects' through goodengineering and process investigation andrectification (Shingo, 1986).


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Shigeo Shingo His method, poka-yoke or zero defects,

stops the process whenever a defect occurs,defines the cause and prevents the

recurring source of the defect. The methodrelies on a process of continuouslymonitoring potential sources of error. Themachines used in this process are equippedwith feedback instrumentation that identifieserrors before they become defects, soremedial action can be taken.


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From the 70s Later American gurus

Crosby

Peters




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Phil Crosby Philip Crosby is perhaps the most well marketed and

charismatic of the American Quality Gurus.

He is a graduate of the Western Reserve University,and after serving with the US Navy in the Korean war,he held a variety of quality control jobs.

He spent fourteen years working his way up within ITT,eventually becoming Corporate VP and Director ofQuality, with worldwide responsibilities.


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Phil Crosby In 1979 Crosby published his famous "Quality is

Free" book, and as a result of that success, left ITTto form his own company, Philip Crosby AssociatesInc.

Crosby's name is most strongly associated with the"Do it Right First Time" and "Zero Defects"concepts.

Crosby believes that most companies spend up to5% of their operating revenues in correctingmistakes which need not have been made in thefirst place.


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Phil Crosby He does not subscribe to the view that

workers should take primary responsibility

for quality. He places great emphasis on

the "top-down" approach, stressing that

senior management is entirely responsible

for quality


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Phil Crosby Crosby defines quality as conformance to

requirements which the company itself hasestablished for its products based directly on its

customers' needs. Quality is an inherentcharacteristic of the product, not an addedelement. Crosby argues that management is toblame for the vast majority of the quality

problems within an organization.

Moreover, themost important performance measurementwithin an organization is the cost of quality andit is cheaper to get things right first time.


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Phil Crosby Crosby defines Four Absolutes of Quality Management:

1. Quality is defined as conformance to requirements, not

"goodness" or "elegance".

2. The system for causing quality is prevention, not appraisal.

3. The performance standard must be Zero Defects, not "that's

close enough".

4. The measurement of quality is the price of non-conformance.

See Kelemen p37 for his 14 steps to quality improvement


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Tom Peters Tom Peters is an American consultant who has

researched into the secrets of most successful

American companies. In his most popular book, In

Search of Excellence (with Waterman, 1982) he

presents Excellence as a universal icon that can guide

businesses and sift through winners and losers.

Excellence is synonymous with quality yet it isindefinable through objective and rational methods of

research.


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Tom Peters In a second book, A Passion for

Excellence (1985), Peters and Austin

identify leadership as central to thequality improvement process. Theysee management by walking about(MBWA) as the basis of leadership for

it enables the leader to keep in touchwith the workers, customers andsuppliers.


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Tom Peters In his third book, Thriving on Chaos

(1987) he prescribes ways of bringing

about a management revolution in the

West. Such ways tend to focus on the end-

user as the most important factor in

judging quality efforts.


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Quality management Quality management is concerned

with controlling activities with the aim

of ensuring that products and servicesare fit for their purpose and meet thespecifications.


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Quality assurance

Quality assurance is about how abusiness can design the way a product

of service is produced or delivered tominimize the chances that output willbe sub-standard. The focus of quality

assurance is, therefore on the productdesign/development stage.


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QUALITYASSURANCEWhy focus on these stages? The idea is

that - if the processes and procedures

used to produce a product or service aretightly controlled - then quality will be"built-in". This will make the productionprocess much more reliable, so there will

be less need to inspect production output(quality control).


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QUALITY ASSURANCE Quality assurance involves developing

close relationships with customers and

suppliers. A business will want to makesure that the suppliers to its productionprocess understand exactly what is

required - and deliver!

Quality Assurance vs Strategic


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Quality Assurance vs. StrategicApproach

Quality Assurance Emphasis on finding and correcting defectsbefore reaching market

Strategic Approach Proactive, focusing on preventing mistakesfrom occurring

Greater emphasis on customer satisfaction


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Dimensions of quality

QUALITY

Performance

Features

Reliability

Aesthetics

Response

Serviceability

Durability

Conformance


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Dimensions of Quality

Performance - main characteristics ofthe product/service

Aesthetics - appearance, feel, smell,taste

Special Features - extra

characteristics


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Conformance - how well product/serviceconforms to customers expectations

Reliability - consistency of performance


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Dimensions of Quality (Contd)

Durability - useful life of theproduct/service

Perceived Quality - indirectevaluation of quality (e.g. reputation)

Serviceability - service after sale

Examples of Quality


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Examples of QualityDimensions

Dimension

1. Performance

2. Aesthetics

3. Special features

(Product)Automobile

Everything works, fit &finishRide, handling, grade ofmaterials usedInterior design, soft touch

Gauge/control placementCellular phone, CD

player

(Service)Auto Repair

All work done, at agreedpriceFriendliness, courtesy,Competency, quicknessClean work/waiting area

Location, call when readyComputer diagnostics

Examples of Quality Dimensions


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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

S i Q lit


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Service Quality

TangiblesConvenience

Reliability

ResponsivenessTime

Assurance

Courtesy


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Examples of Service QualityDimension Examples1. 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 andable to answer questions?

5. Time How long did the customer wait?

6. Assurance Did the customer service personnel seemknowledgeable about the repair?

7. Courtesy Were customer service personnel and thecashierfriendly and courteous?

D t i t f Q lit ( td)


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Determinants of Quality (contd)

Quality of design Intension of designers to include or excludefeatures in a product or service

Quality of conformance The degree to which goods or servicesconform to the intent of the designers

The Consequences of Poor


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The Consequences of PoorQuality

Loss of business

LiabilityProductivity

Costs


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Purchasing

& Inventory

AssessmentOccurrence

Management

Information

Management

Process

ImprovementCustomer

Service

Facilities &

Safety

TheQuality System

Organization Personnel Equipment

Documents

& Records

Process

Control

(QC & EQA) &

SpecimenManagement


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Competitive Advantage

The terminology used in the field

of strategic management that might

possibly garner the prize for the mostoverworked and least understood catch-

phrase is "competitive advantage."

The extension of that phrase into

"sustainable competitive advantage" is

currently an elaboration of ambiguity.


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that which one firm can do better thananother to satisfy customer requirements.

Some benefit value provided by a product orcompany, often unique to the organization

concerned, that gives it superiority in themarket place.


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Condition which enables a company tooperate in a more efficient otherwise

higher-quality manner than the companiesit competes with, and which results inbenefits accruing to that company.


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process by which a company studies the

actions of its major competitors in order

to determine what specific strategies they

are following and how those strategies

affect its own; also used by marketers as

they try to develop competitive

advantages, ...


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OrderQualifie

rs and

Winne

rs

Orderwinners

are thecriteria that differentiates

theproducts and services of onefirm from another

criterion that differentiates yourservice/product above the competition price, quality, reliability


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Order qualifiers

are thebasiccriteria that permit

the firms products to beconsidered as candidates forpurchaseby customers

screening criterion that allows yourproducts to be considered delivery on-time, reliability, general quality