Quality Management

Quality Management
What does the term quality mean?

Quality is the ability of a product or service to consistently meet or exceed customer expectations.

Evolution of Quality Management

1924 - 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

CustomerDriven Definitions of Quality

1. 2. 3. 4. 5. Conformance to specifications (requirements). Value for money Fitness for use. Support provided by seller (customer services) Psychological impression (image, aesthetics)

Three Levels of Quality

1.Organisation level Meeting external customer requirements 2..Process level Meeting the needs of internal customers 3.Performer level (job level or task design level) Meeting the requirements of accuracy, completeness innovation, timeliness and cost.

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

Key Contributors to Quality Management

Contributor Known for
Deming 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; quality circles Taguchi loss function Continuous improvenment

Juran Feignbaum Crosby Ishikawa

Taguchi Ohno and Shingo

Quality

Deming Wheel/Deming Cycle/PDCA Cycle

Demings Triangle (3 Axioms)

2. Joseph Juran (USA) Defined quality as fitness for use. a. Top management commitment b. Costs of quality c. Quality triology d. 10 steps for quality improvement e. Universal breakthrough sequence.

Costs of Quality
1. Prevention costs Costs of quality planning, new product review, training etc 2. Appraisal cost Inspection, audit etc. 3. Internal failure costs scrap, rework, downtime 4. External failure costs Customer delivery issues, customer complaints etc

Quality Triology
i. Quality planning ii. Quality control and iii.Quality improvement

Philip B Crosby (USA): (Management consultant and director of Crosbys Quality College. Wrote a book titled Quality is free of which 1 million copies sold) Quality Philosophies i. Quality is free ii. Goal of zero defects iii.6 Cs Comprehension, Commitment, Competence, Correction, Communication, Continuance. iv.Four absolutes of Quality v. 14 steps for quality improvement vi.Quality Vaccine/Crosby Triangle. Integritypolicies, communication, Systems - operation

Armand V. Feigenbaum (USA) a. Concept of TQC (Total Quality Control) b. Quality at the source c. Three steps to quality Quality leadership, Modern quality technology, Organisational Commitment. d. SQC and CWQC (Company-Wide Quality Control)

Kaoru Ishikawa (Japan) (Japanese Quality Authority Quality circles Ishikawa diagram for problem solving Quality training Root cause elimination Total employee involvement Customer focus Elimination of inspection C.W.Q.C. Japanese quality strategy.

Genichi Taguchi (Japan) Quality Engineering Taguchi Methods Taguchis quality loss function (L = cd2) [L=LossC = Constant d = deviation i.e., x T]

Masaki Imai (Management Consultant of Japan) (Continuous improvement) Shigeo Shingo (Japan) Poka Yoke means Fail proofing or Fool-proofing to reduce defects to zero (Handle errors as they occur) Dr. Walter Shewhart (USA) : (Statistician at Bell Laboratories) Statistical Quality Control : (a) SPC control charts (b) Acceptance sampling (with Dodge & Romig)

Activities Falling Under Kaizen Umbrella

1. Customer orientation 2. Total quality control 3. Robotics 4. Advanced technology (NC, CNC machines) 5. Quality circles Automation 6. Automation Discipline in workforce 7. Discipline in workforce 8. Total productive maintenance 9. Kanban (JIT) 10. Quality improvement 11. Zero defect program 12. Quality improvement teams 13. Co-operation (labour management relation) 14. New product development 15. Productivity improvement

Kaizen Movement or Japanese 5 S Approach

1. Seiri Straighten-up Avoid unnecessary materials, tools, machinery, documents etc. 2. Seiton putting things in order Everything should be in its place and there should be place for everything (good house keeping) 3. Seiso clean-up Every individual should clean-up his work place everyday after the work. 4. Seiketsu (Personal cleanliness) Healthy body healthy mind. 5. Shitsuke (discipline) Every worker & manager has to follow rules and procedures in the work place.

3 MUs Check List (of Kaizen)

1. Muda (Waste) 2. Muri (Strain) 3. Mura (Discrepancy)

Dimensions of Quality
Performance - main characteristics of the product/service Aesthetics - appearance, feel, smell, taste Special Features - extra characteristics Conformance - how well product/service conforms to customers expectations

Reliability - consistency of performance

Dimensions of Quality (Contd)

Durability - useful life of the product/service
Perceived Quality - indirect evaluation of
quality (e.g. reputation)

Serviceability - service after sale

Examples of Quality Dimensions

Dimension
1. Performance

(Product) Automobile
Everything works, fit & finish Ride, handling, grade of materials used Interior design, soft touch

(Service) Auto Repair

All work done, at agreed price Friendliness, courtesy, Competency, quickness Clean work/waiting area

2. Aesthetics

3. Special features Gauge/control placement Location, call when ready Cellular phone, CD Computer diagnostics player

Examples of Quality Dimensions (Contd)

Dimension (Product) Automobile
5. Reliability Infrequency of breakdowns

(Service) Auto Repair

Work done correctly, ready when promised Work holds up over time Award-winning service department

6. Durability

Useful life in miles, resistance to rust & corrosion Top-rated car

7. Perceived quality

8. Serviceability Handling of complaints and/or Handling of complaints requests for information

Service Quality
Convenience Reliability Responsiveness Time Assurance Courtesy Tangibles

Examples of Service Quality

Table 9.4

Dimension
1. Convenience 2. Reliability 3. Responsiveness 4. Time 5. Assurance 6. Courtesy

Examples
Was the service center conveniently located? Was the problem fixed? Were customer service personnel willing and able to answer questions? How long did the customer wait? Did the customer service personnel seem knowledgeable about the repair? Were customer service personnel and the cashierfriendly and courteous?

7. Tangibles

Were the facilities clean, personnel neat?

 SERVQUAL How does one measure service quality? Parasuraman et al pioneered a measuring scale called SERVQUAL. Servqual has five dimensions: - Tangibles ..physical facilities, appearance of people - Reliability ..perform the promised service - Responsiveness .. willingness & promptness in
helping customers

- Assurance .. inspire trust from customers - Empathy .. individualized attention given to customers

Challenges with Service Quality

Customer expectations often change Different customers have different expectations Each customer contact is a moment of truth Customer participation can affect perception of quality Fail-safing must be designed into the system

Quality Function Deployment (QFD)

QFD is incorporation of customers voice into the design of the product / service Building a House of Quality as per the customers requirements.

The Consequences of Poor Quality

Loss of business Liability Productivity Costs

Costs of Quality
Failure Costs - costs incurred by defective parts/products or faulty services.

Internal Failure Costs

Costs incurred to fix problems that are detected before the product/service is delivered to the customer.

External Failure Costs

All costs incurred to fix problems that are detected after the product/service is delivered to the customer.

Costs of Quality (continued)

Appraisal Costs

Costs of activities designed to ensure quality or uncover defects All TQ training, TQ planning, customer assessment, process control, and quality improvement costs to prevent defects from occurring

Prevention Costs

Ethics and Quality

Substandard work
Defective products Substandard service Poor designs Shoddy workmanship Substandard parts and materials
Having knowledge of this and failing to correct and report it in a timely manner is unethical.

Quality Awards

Baldrige Award Deming Prize

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)

Benefits of Baldrige Competition

Financial success Winners share their knowledge The process motivates employees The process provides a well-designed quality system The process requires obtaining data The process provides feedback

European Quality Award

Prizes intended to identify role models
Leadership Customer focus Corporate social responsibility People development and involvement Results orientation

The Deming Prize

Honoring W. Edwards Deming

Japans highly coveted award

Main focus on statistical quality control

Quality Certification
ISO 9000
Set of international standards on quality management and quality assurance, critical to international business

ISO 14000
A set of international standards for assessing a companys environmental performance

ISO 9000 Quality Management Principles

Customer focus Leadership People involvement Process approach A systems approach to management Continual improvement Factual approach to decision making Mutually beneficial supplier relationships

ISO 14000
ISO 14000 - A set of international standards for assessing a companys environmental performance Standards in three major areas
Management systems Operations Environmental systems

ISO 14000
Management systems
Systems development and integration of environmental responsibilities into business planning

Operations
Consumption of natural resources and energy

Environmental systems
Measuring, assessing and managing emissions, effluents, and other waste

Total Quality Management

A philosophy that involves everyone in an organization in a continual effort to improve quality and achieve customer satisfaction.
T Q M

The TQM Approach

1.Find out what the customer wants 2.Design a product or service that meets or exceeds customer wants 3.Design processes that facilitates doing the job right the first time 4.Keep track of results 5.Extend these concepts to suppliers

Elements of TQM
1. Continual improvement 2. Competitive benchmarking 3. Employee empowerment 4. Team approach 5. Decisions based on facts 6. Knowledge of tools 7. Supplier quality 8. Champion 9. Quality at the source 10. Suppliers

Continuous Improvement
Philosophy that seeks to make never-ending improvements to the process of converting inputs into outputs. Kaizen: Japanese word for continuous improvement.

Quality at the Source

The philosophy of making each worker responsible for the quality of his or her work.

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

Six sigma: A business process for improving quality, reducing costs, and increasing customer satisfaction.

SIX SIGMA
What do various Sigma levels mean?
Sigma level 1 2 3 4 5 6 Defects per Million opportunities 6.90,000 3,08,537 66,807 6,210 233 3.4

Six Sigma Programs

Six Sigma programs
Improve quality Save time Cut costs

Employed in
Design Production Service Inventory management Delivery

Six Sigma Management

Providing strong leadership Defining performance metrics Selecting projects likely to succeed Selecting and training appropriate people

Six Sigma Technical

Improving process performance Reducing variation Utilizing statistical models Designing a structured improvement strategy

Six Sigma Team

Top management Program champions Master black belts Black belts Green belts

Six Sigma Quality: DMAIC Cycle

Define, Measure, Analyze, Improve, and Control (DMAIC) Developed by General Electric as a means of focusing effort on quality using a methodological approach Overall focus of the methodology is to understand and achieve what the customer wants A 6-sigma program seeks to reduce the variation in the processes that lead to these defects DMAIC consists of five steps.

9-53

Six Sigma Quality: DMAIC Cycle (Continued)

1. Define (D)
2. Measure (M)

Customers and their priorities

Process and its performance

3. Analyze (A)
4. Improve (I)

Causes of defects
Remove causes of defects

5. Control (C)

Maintain quality

Obstacles to Implementing TQM

Lack of:
Company-wide definition of quality Strategic plan for change Customer focus Real employee empowerment Strong motivation Time to devote to quality initiatives Leadership

Obstacles to Implementing TQM

Poor inter-organizational communication View of quality as a quick fix Emphasis on short-term financial results Internal political and turf wars

Criticisms of TQM
1. Blind pursuit of TQM programs 2. Programs may not be linked to strategies 3. Quality-related decisions may not be tied to market performance 4. Failure to carefully plan a program

Process Management
Process management involves design, control and improvement of key business process. 4 category of business processes are: 1. Design processes product design (or service design) and design of production/delivery processes that create and deliver products 2. Process design (conversion processes) 3. Support processes (purchase, stores, quality control, marketing, maintenance, finance etc) 4. Supplier processes/partnering process (vendor development)

The Process Improvement Cycle

Figure. 9.3
Select a process

Document
Study/document Evaluate

Implement the Improved process

Seek ways to Improve it

Design an Improved process

Process Improvement
Process Improvement: A systematic approach to improving a process Process mapping Analyze the process Redesign the process

5 W 2 H Approach to Process Improvement

1. 2. 3. 4. 5. 6. 7.

What is being done? Why is this necessary? Where is it being done? When is it done? Who is doing it? How is it being done? How much does it cost now?

Basic Quality Tools

Flowcharts Check sheets Histograms Pareto Charts Scatter diagrams Control charts Cause-and-effect diagrams Run charts

Check Sheet
Billing Errors
Wrong Account

Monday

Wrong Amount

A/R Errors
Wrong Account Wrong Amount

Pareto Analysis
80% of the problems may be attributed to 20% of the causes.

Number of defects
Off Smeared Missing Loose Other center print label

Control Chart
Figure 9.11
1020 1010 1000

UCL

990
980 970 0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15

LCL

Cause-and-Effect Diagram
Figure 9.12

Methods
Cause
Cause Cause

Materials
Cause
Cause Cause

Environment
Cause
Cause Cause Cause

Effect
Cause
Cause

People

Equipment

Ishikawa Diagrams

Tracking Improvements
Figure 9-18
UCL UCL UCL

LCL LCL Process centered Process not centered and stable and not stable LCL Additional improvements made to the process

Failure Mode and Effect Analysis (FMEA) is a structured approach to identify, estimate, prioritize, and evaluate risk of possible failures at each stage in the process Design of Experiments (DOE) a statistical test to determine cause-and-effect relationships between process variables and output Poka-Yoke includes
Checklists Special tooling that prevents workers from making errors

Methods for Generating Ideas

Brainstorming Quality circles Interviewing

Benchmarking
5W2H

QUALITY CIRCLES (QC)

Workers direct involvement in solving problems A QC has 3-15 volunteers group (circle) meeting regularly in order to identify, analyze and search for solutions to work-related problems and the ways of implementing solutions. Quality Circle is a philosophy of human resource development.

Quality Circles
Team approach
List reduction Balance sheet Paired comparisons

Bench marking :
Measuring a companys performance against that of best-in-class companies, determining how the best-in-class achieve those performance levels and using the information as a basis for the companys targets, strategies and implementation. 3 Types of Benchmarking 1. Performance benchmarking 2. Process benchmarking 3. Strategic benchmarking

Benchmarking Process
Identify a critical process that needs improving Identify an organization that excels in this process Contact that organization Analyze the data Improve the critical process

 Questions