Quality in Small Businesses

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Quality in Small Businesses

• Michael Craig
• Peter Almlie
• Rosalia Curiel
• Michael Bordin

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Topics

• What is a Small Business?
• Quality Defined
• How to Improve Quality
• The Deming Cycle
• Six Sigma
• Case Study Glissade Mfg.

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What is a Small Business?

• Any independently owned and operated business
  that does not employ more than 500 people.
• The business must not dominate the competitive
  industry that it is involved in.

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Small Business Cont.

• Represent 99.7 of all employers.
• Employ 53 of the private workforce.
• Provide 47 of all sales in the United States.
• Provide 51 of the private sector output.
• Represent 96 of all U.S. exporters of goods.

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Quality Defined

• The totality of features and characteristics of
  a product or service that bears on its ability to
  satisfy given needs.
• -American Society for Quality Control
  (ASQC)

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Dimensions of Quality

• 1. Performance
• 2. Features
• 3. Reliability
• 4. Conformance
• 5. Durability
• 6. Serviceability
• 7. Aesthetics
• 8. Safety
• 9. Other perceptions

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The Deming Cycle

• Simple methodology for improvement
• It was originally called the Shewhart cycle after
  its founder, Walter Shewhart, but was renamed the
  Deming Cycle by the Japanese in 1950
• Much of the focus of the Deming Cycle is on
  Implementation and learning
• Based on the premise that improvement comes from
  the application of knowledge

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The Deming Cycle

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The Deming Cycle

• Plan Design or revise business process
  components to improve results
• Do Implement the plan and measure its
  performance
• Check Assess the measurements and report the
  results to decision makers
• Act Decide on changes needed to improve the
  process

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Small Business ExampleUsing the Deming Cycle

• Owners wanted to improve the quality of their
  Restaurant by reducing the time customers waited
  in line.
• These were the facts
• Customers waited in line for up to 15 minutes
• Usually, tables were available
• Many of their customers were regulars
• People taking orders and preparing food were
  getting in each others way.

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Small Business ExampleUsing the Deming Cycle

• Plan Decided on changes they wanted made
• Provide a way for customers to fax their orders
  in ahead of time
• Construct a preparation table in the kitchen with
  ample room for fax orders
• Devote one of their two cash registers to
  handling fax orders
• Do The owners observed the results of the three
  measures for three weeks
• Check Detected several improvements
• Time in line went down from 15 min. to 5 min.

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Small Business ExampleUsing the Deming Cycle

• Act The owners held a meeting with all employees
  to discuss the results
• Purchase fax machine
• Prepare phone orders in the kitchen with the fax
  orders
• Use both cash registers to handle walk-up and fax
  orders

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What is Six-Sigma?

• Six Sigma is a statistical business improvement
  approach that seeks to find and eliminate defects
  and their causes from an organization's
  processes, focusing on outputs of critical
  importance to customers.
• Developed in the late 70s at Motorola in answer
  to a need for a universal system to assess
  quality, produce quantifiable results, and
  establish a quality goal that would define the
  term world class.

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What is Six-Sigma?

• Sigma is the Greek letter used to designate a
  standard variation from a bell curve.
• The higher the sigma, the fewer the defects.
• One Sigma 690,000 defects per million
• Two Sigma 308,000 defects per million
• Three Sigma 66,800 defects per million
• Four Sigma 6,210 defects per million
• Five Sigma 230 defects per million
• Six Sigma 3.4 defects per million

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Benefits to a Small BusinessSix Sigma

• Increase capacity without increasing facilities
  and equipment.
• Remove the overhead burden in your organization.
• Liberate the creative ownership of the labor
  force.
• Overcome specification paralysis.
• Develop a supplier partnership.
• Organize problem solving from a Value Stream
  perspective.
• Satisfy customers, internal or external 99.9999
  of the time.
• Grow Revenues and profits.

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How to Implement Six-Sigma

• GEs Six-Sigma Problem Solving Approach
• Define
• Measure
• Analyze
• Improve
• Control

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Key Principles for Effective Six Sigma
Implementation

• Committed leadership from Top management
• Integration with existing initiative, business
  strategy, and performance measurement
• Process thinking
• Disciplined customer and market intelligence
  gathering
• A bottom-line orientation
• Leadership in the trenches
• Training
• Continuous reinforcement and rewards

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Case Study Glissade Mfg.

• Local Manufacturer of Snowboards.
• Specialize in high quality design and materials.
• Employed less than 20 workers and managers
  combined.
• One of the most respected and innovative
  Manufacturers in the snowboarding industry.

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Glissade and Quality

• Most of Glissades customers were ones who had
  previously purchased a Glissade product.
• Customers could expect a board that was high in
  quality.
• All boards made by hand, including great
  craftsmanship.
• Embraced the idea that Quality in both materials
  and board construction would increase their
  market share of the snowboarding industry.

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Work Flow

• Base and Edges Constructed together.
• Core and top sheet are produced
• Fiberglass, rubber edges, plastic nose and tail
  are placed on a rack along with the above
  materials.
• The Lay-up department receives this rack and
  makes an initial inspection of all of the
  components.
• Then the board is assembled with the addition of
  polyester resin and the above components.

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Labor and Quality

• As a Lay-up technician I was responsible for
  every board I made.
• I could reject any component that didnt meet
  standards that I was informed of during my
  initial training period.
• I could also consult managers, other labor, or
  the person who made the rejected component.

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Typical Quality Issues

• Resin and Hardener ratio was the most crucial
  component. To much hardener would cause the
  board to cure to quickly, while to little
  hardener wouldnt allow the board to cure
  properly.
• Chipped or damaged core.
• Dirty top sheet, causing indentations and
  imperfections on the boards surface finish.

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Tracking Quality

• Every board and component is accounted for during
  each process via daily Bill of Materials.
• All boards that were assembled and sent to
  finishing were labeled with who made them, what
  press they were made on, the model number, and
  the date.
• This allowed the company to immediately remedy
  defects in quality by having an accurate account
  of the workers or processes who may have
  contributed to the defective board.

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Advantages

• Glissade kept things small and simple, thus
  allowing them to quickly track and solve problems
  with quality.
• Gave labor a sense of pride in their work and
  product, as well as creating a family type
  environment.
• Extremely flexible in terms of products and
  processes, allowing them to experiment and
  innovate in the areas of design and materials.

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Glissade Views

• Quality adds value to the product.
• Quality allows them to be competitive with
  companies like Burton, Sims, etc.
• Quality drives employees to deliver the highest
  standards in terms of labor and attitude.
• Quality keeps customers loyal.