Managing Quality Chapter 4

1

• Managing QualityChapter 4
• Learning Objectives
• Identify or define
• Quality
• Malcolm Baldrige National Quality Awards
• Demings, Juran, and Crosby philosophies
• Taguchi Technique
• Describe or Explain
• Why quality is important
• Total Quality Management (TQM)
• House of Quality
• Pareto charts
• Process charts
• Quality robust products
• Inspection

2
Ways in Which Quality Can Improve Productivity

• Market Gains
• Improved response
• Lower selling prices
• Improved reputation

Increased Profits
Improved Quality

• Reduced Costs
• Increased productivity
• Lower rework and scrap costs
• Lower warranty costs

3
Total Quality Management (TQM) Conveys
total company wide effort through full
involvement of all workforce and a focus on
continuous improvement.
4
Flow of Activities Necessary to Achieve Total
Quality Management

• Organizational Practices

• Quality Principles

• Employee Fulfillment

5
Organizational Practices

• 1. Leadership
• 2. Mission statement
• 3. Effective operating procedure
• 4. Staff support
• 5. Training
• Yields What is important and what is to be
  accomplished

6
Quality Principles

• 1. Customer focus
• 2. Continuous improvement
• 3. Employee empowerment
• 4. Benchmarking
• 5. Just-in-time
• 6. Tools of TQM
• Yields How to do what is important and to be
  accomplished

7
Employment Fulfillment

• 1. Empowerment
• 2. Organizational commitment
• Yields Employees attitudes that can accomplish
  what is important and to be accomplished

8
Customer Satisfaction

• 1. Meeting customer needs
• 2. Repeat customers
• Yields An effective organization with a
  competitive advantage

9
Definitions of Quality

• 1. ASQC Product characteristics features that
  affect customer satisfaction
• 2. User-Based What consumer says it is
• 3. Manufacturing-Based Degree to which a product
  conforms to design specification
• 4. Product-Based Level of measurable product
  characteristic

10
Dimensions of Quality for Goods

• Performance (Operating characteristics e.g.
  brakes)
• Features (other things added to enhance
  performance e.g. reclining seats etc.
• Reliability (Surviving over a specified period)
• Durability (Amount of use one get before
  deterioration)
• Conformance (Degree to performance
  characteristics match standards)
• Serviceability (Speed, courtesy and competence of
  repairs)
• Aesthetic (Look, feel sound etc.)
• Perceived quality (Subjective assessment based on
  image or brand name)

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Dimensions of Quality for Services

• Time (Customers waiting time)
• Timeliness (Will the item be delivered on time?)
• Completeness (Are all items delivered?)
• Courtesy (Good relationships)
• Consistency (Services are delivered on the same
  fashion)
• Accessibility (Ease of obtaining service or
  locating site)
• Accuracy (Correct performance)
• Responsiveness (Quick reaction to problems)
• Communication (keeping customers informed in
  the language they can understand)
• Security (Freedom form danger)
• Credibility (Honesty , trustworthiness etc.)

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Three Reasons Quality is Important

• 1. Company reputation
• 2. Product liability
• 3. Global implications

13
Importance of Quality

• Costs market share

• Companys reputation
• Product liability
• International implications

14
International Quality Standards

• Industrial Standard Z8101-1981 (Japan)
• Specification for TQM
• ISO 9000 series (Europe/EC)
• Common quality standards for products sold in
  Europe (even if made in U.S.)
• ISO 14000 series (Europe/EC)
• Standards for recycling, labeling etc.
• ASQC Q90 series MILSTD (U.S.)

15
Malcom Baldridge National Quality Award

• 1 Established in 1988 by the U.S. government
• 2. Designed to promote TQM practices
• 3. Some criteria
• Senior executive leadership strategic planning
  management. of process quality
• Quality results customer satisfaction
• 4. Recent winners
• Corning Inc. GTE ATT Eastman Chemical. Fedex

16
Traditional Quality Process (Manufacturing)
Quality is customer driven!
17
Total Quality Management (TQM)

• Encompasses entire organization, from supplier to
  customer
• Stresses a commitment by management to have a
  continuing company-wide drive toward excellence
  in all aspects of products and services that are
  important to the customer.

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Achieving Total Quality Management
EffectiveBusiness
CustomerSatisfaction
Employee Fulfillment
Attitudes (e.g., Commitment)
How to Do
Quality Principles
What to Do
Organizational Practices
19

• Foundations of TQM
• Focus on the customer
• Participation and teamwork
• Continuous improvement

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Concepts of TQM

• 1. Continuous improvement
• 2. Employee empowerment
• 3. Benchmarking
• 4. Just-in-time (JIT)
• 5. Knowledge of tools

21
Continuous Improvement

• 1. Represents continual improvement of process
  customer satisfaction
• 2. Involves all operations work units
• 3. Other names
• Kaizen (Japanese)
• Zero-defects
• Six sigma

22
Employee Empowerment

• 1. Getting employees involved in product
  process improvements
• 85 of quality problems are due to process
  material
• 2. Techniques
• Support workers, enlarge jobs
• Let workers make decisions
• Build teams quality circles

23
Quality Circles

• 1. Group of 6-12 employees from same work area
• 2. Meet regularly to solve work-related problems
• 4 hours/month
• 3. Facilitator trains helps with meetings

24
Demings Fourteen Points

• 1. Create consistency of purpose
• 2. Lead to promote change
• 3. Build quality into the products
• 4. Build long term relationships
• 5. Continuously improve product, quality, and
  service
• 6. Start training
• 7. Emphasize leadership

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Demings Points - continued

• 8. Drive out fear
• 9. Break down barriers between departments
• 10. Stop haranguing workers
• 11. Support, help, improve
• 12. Remove barriers to pride in work
• 13. Institute a vigorous program of education and
  self-improvement
• 14. Put everybody in the company to work on the
  transformation

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Benchmarking

• Selecting best practices to use as a standard
  for performance
• 1. Determine what to benchmark
• 2. Form a benchmark team
• 3. Identify benchmarking partners
• 4. Collect and analyze benchmarking information
• 5. Take action to match or exceed the benchmark

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Resolving Customer Complaints

• 1. Make it easy for clients to complain
• 2. Respond quickly to complaints
• 3. Resolve complaints on the first contact
• 4. Use computers to manage complaints
• 5. Recruit the best for customer service jobs

28
Just-in-Time (JIT)

• Relationship to quality
• JIT cuts cost of quality
• JIT improves quality
• Better quality means less inventory and better,
  easier-to-employ JIT system

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Just-in-Time (JIT)

• 1. Pull system of production/purchasing
• Customer starts production with an order
• 2. Involves vendor partnership programs to
  improve quality of purchased items
• 3. Reduces all inventory levels
• Inventory hides process material problems
• 4. Improves process product quality

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Tools for TQM

• 1. Quality Function Deployment
• House of Quality
• 2. Taguchi technique
• 3. Quality loss function
• 4. Pareto charts
• 5. Process charts
• 6. Cause-and-effect diagrams
• 7. Statistical process control

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Quality Function Deployment(QFD)

• 1. Determines what will satisfy the customer
• 2. Translates those customer desires into the
  target design

32
Quality Function Deployment

• 1. Product design process using cross-functional
  teams
• Marketing, engineering, manufacturing
• 2. Translates customer preferences into specific
  product characteristics
• 3. Involves creating 4 tabular Matrices or
  Houses
• Breakdown product design into increasing levels
  of detail

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To Build House of Quality

• 1. Identify customer wants
• 2. Identify how the good/service will satisfy
  customer wants.
• 3. Relate the customers wants to the products
  hows.
• 4. Identify relationships between the firms
  hows.
• 5. Develop importance ratings
• 6. Evaluate competing products

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House of Quality Sequence
35
House of Quality Example

• Youve been assigned temporarily to a QFD team.
  The goal of the team is to develop a new camera
  design. Build a House of Quality.

36
House of Quality Example
House of Quality Example Youve been assigned
temporarily to a QFD team. The goal of the team
is to develop a new camera design. Build a House
of Quality.
37
House of Quality Example
Customer Requirements
Customer Importance
Target Values
J High relationship K Medium relationship m
Low Relationship
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House of Quality Example
Customer Requirements
Customer Importance
Aluminum Parts
Auto Focus
Auto Exposure
Light weight
Easy to use
Reliable
Target Values
J High relationship K Medium relationship m
Low Relationship
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House of Quality Example
Customer Requirements
Customer Importance
Aluminum Parts
Auto Focus
Auto Exposure
3
J
Light weight
K
2
K
Easy to use
1
K
K
Reliable
Target Values
J High relationship K Medium relationship m
Low Relationship
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House of Quality Example

• High relationship K Medium relationship m Low
  Relationship
• 9
  3 1

Target Values Level of actual performance
required to meet the desired performance
J
Customer Requirements
Customer Importance
Aluminum Parts
Auto Focus
Auto Exposure
3
J
Light weight
K
K
2
Easy to use
1
K
K
Reliable
Importance ratings
27
9
9
Relative weight
0.6
0.2
0.2
5
1
1
Target
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Taguchi Techniques

• 1. Experimental design methods to improve product
  process design
• Identify key component process variables
  affecting product variation
• 2. Taguchi Concepts
• Quality robustness
• Quality loss function
• Target specifications

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Quality Robustness

• 1. Ability to produce products uniformly
  regardless of manufacturing conditions
• 2. Product performance is affected by
• Manufacturing imperfections
• Environmental factors
• Human variation in operating the product.
• 3. Products that are insensitive to external
  sources of variations are called Robust.

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1. Manufacturing Imperfections
Measurement instruments
Operator
Methods
Material
Process
Output
Inputs
Tools
Machines
Environment
Human inspector
Causes of the imperfections are called Natural or
Common causes They can be minimized by
management decisions
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• Environmental factors
• Temperature
• Humidity
• Vibrations
• Fluctuation in power supply
• Variations in human operator

• Human variation
• Poor training
• Inappropriate method

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Quality Loss Function

• 1. Shows social cost () of deviation from target
  value
• 2. Assumptions
• Most measurable quality characteristics (e.g.,
  length, weight) have a target value
• Deviations from target value are undesirable
• 3. Equation L D2 C
• L Loss () D Deviation C Cost

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Quality Loss Function Graph
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Quality Loss Function Example

• The specifications for the diameter of a gear are
  25.00 0.25 mm.
• If the diameter is out of specification, the gear
  must be scrapped at a cost of 4.00.
• What is the loss function?

48
Quality Loss Function Solution

• L D2 C (X - Target)2 C
• L Loss () D Deviation C Cost
• 4.00 (25.25 - 25.00)2 C
• Item scrapped if greater than 25.25 (USL 25.00
  0.25) with a cost of 4.00
• C 4.00 / (25.25 - 25.00)2 64
• L D2 64 (X - 25.00)2 64
• Enter various X values to obtain L plot

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Quality Loss Function Solution Use of Loss
Function to Establish Tolerance Cassette Tape
Desired speed 1.875in/sec Any deviation
causes poor sound quality Customers return the
product if it deviates by 0.15in/sec Cost of
adjusting a return tape under warranty is
20.00 (X-Target) 0.15 implies that 20
K (X-Target)2
20 K (0.15)2

K888.9 At the factory the cost
of adjusting a tape 3.00 What is the new
deviation 3 888.9(X 1.875)2 (X 1.875)
0.058 New Deviation or Tolerance
1.875
0.058
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Target Specification Example
A study found U.S. consumers preferred Sony TVs
made in Japan to those made in the U.S. Both
factories used the same designs specifications.
The difference in quality goals made the
difference in consumer preferences.
Japanese factory (Target-oriented)
U.S. factory (Conformance-oriented)
51
Pareto Analysis of Wine Glass Defects
Frequency (number)
16
5
4
3
72
Causes, by percent of total defects
52
Process Chart

• 1. Shows sequence of events in process
• 2. Depicts activity relationships
• 3. Uses
• Identify data collection points
• Find problem sources
• Identify places for improvement
• Identify where travel distances can be reduced

53
Process Chart Example
54
Cause and Effect Diagram

• 1. Used to find problem sources/solutions
• 2. Other names
• Fish-bone diagram, Ishikawa diagram
• 3. Steps
• Identify problem to correct
• Draw main causes for problem as bones
• Ask What could have caused problems in these
  areas? Repeat for each sub-area.

55
Cause and Effect Diagram

• 1. Used to find problem sources/solutions
• 2. Other names
• Fish-bone diagram, Ishikawa diagram
• 3. Steps
• Identify problem to correct
• Draw main causes for problem as bones
• Ask What could have caused problems in these
  areas? Repeat for each sub-area.

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Cause and Effect Diagram Example
Measurements
Manpower
Environment
Tired
Over time
Tool
Not calibrated
Wood
Drill
Lathe
Steel
Old
Slow
Material
Method
Machinery
57
Statistical Process Control (SPC)

• 1. Uses statistics control charts to tell when
  to adjust process
• 2. Developed by Shewhart in 1920s
• 3. Involves
• Creating standards (upper lower limits)
• Measuring sample output (e.g. mean weight.)
• Taking corrective action (if necessary)
• 4. Done while product is being produced

58
Statistical Process Control Steps

• Examples of Assignable
• Poor Training
• Tool wear
• Poor Supervision
• Mis calibration
• Inappropriate method
• Assignable causes can be traced to a specific
  reason

59
Control Chart Example
A.
Mean
Process is Out of Control due to A B. These are
caused by external causes which are not inherent
in the process These are referred to as Special
or Assignable causes.
B
60
Inspection

• 1. Involves examining items to see if an item is
  good or defective
• 2. Detect a defective product
• Does not correct deficiencies in process or
  product
• 3. Issues
• When to inspect
• Where in process to inspect

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When and Where to Inspect

• 1. At the suppliers plant while the supplier is
  producing
• 2. At your plant upon receipt of goods from the
  supplier
• 3. Before costly or irreversible processes
• 4. During the step-by-step production processes
• 5. When production is complete
• 6. Before shipment from your plant
• 7. At the point of customer contact

62
When and Where to Inspect in Services
Business Where Variable

• Bank Teller station Speed, courtesy
• Checking Accuracy
• Store Stockrooms Stock rotation
• Display areas Attractiveness
• Counters Courtesy, knowledge

63
TQM In Services

• 1. Service quality is more difficult to measure
  than for goods
• 2. Service quality perceptions depend on
• Expectations vs. reality
• Process outcome
• 3. Types of service quality
• Normal Routine service delivery
• Exceptional How problems are handled