Defining Quality
The totality of features and characteristics of a product or service that bears on its ability to satisfy stated or implied needs
Two ways Quality improves profitability
What kind of costs would reduce as an effect of increase quality ?
Sales Gains via
Improved response
Flexible pricing
Improved reputation
Reduced Costs via Increased productivity Lower rework and scrap costs Lower warranty costs
Different Views of quality
User based
manufacturing based
product based
User based quality
better performance, more features
manufacturing based quality
conformance to standards, making it right the first time
product-based quality
specific and measurable attributes of the product
Key Dimensions of Quality
Durability Serviceability Aesthetics Perceived quality Value Performance Features Reliability Conformance
Costs of Quality
Prevention costs
appraisal costs
internal failure
external failure
Costs of Quality: Prevention costs
– reducing the potential for defects
Costs of Quality: appraisal costs
– evaluating products, parts, and services
Costs of Quality: internal failure
– producing defective parts or service before delivery
Costs of Quality: external costs
– defects discovered after delivery
Ethics and Quality Management
- Operations managers must deliver healthy, safe quality products and services
- Poor quality risks injuries, lawsuits, recalls, and regulation
- Organizations are judged by how they respond to problems
- All stakeholders must be considered
ISO 9000 series
Common quality standards for products sold in Europe (even if made in U.S.)
2008 update places greater emphasis on leadership and customer requirements and satisfaction
ISO 14000Environmental Standard
Core elements1: Environmental management Auditing Performance evaluation Labelling Life cycle assessment
Advantages:
- Positive public image and reduced exposure to liability
- Systematic approach to pollution prevention
- Compliance with regulatory requirements and opportunities for competitive advantage
- Reduction in multiple audits
TQM
Encompasses entire organization, from supplier to customer
Stresses a commitment by management to have a continuing, companywide drive toward excellence in all aspects of products and services that are important to the customer
Deming’s 14 Points
- Create consistency of purpose
- Lead to promote change
- Build quality into the product; stop depending on inspections
- Build long-term relationships based on performance instead of awarding business on price
- Continuously improve product, quality, and service
- Start training
- Emphasize leadership
- Drive out fear
- Break down barriers between departments
- Stop haranguing workers
- Support, help, and improve
- Remove barriers to pride in work
- Institute education and self-improvement
- Put everyone to work on the transformation
Seven Concepts of TQM
1) Continuous improvement
2) Six Sigma
3) Employee empowerment
4) Benchmarking
5) Just-in-time (JIT)
6) Taguchi concepts
7) Knowledge of TQM tools
Seven Concepts of TQM:Continuous Improvement
- Represents continual improvement of all processes
- Involves all operations and work centres including suppliers and customers
- People, Equipment, Materials, Procedures
Seven Concepts of TQM:Six Sigma Program
- -Originally developed by Motorola, adopted and enhanced by Honeywell and GE
- -Highly structured approach to process improvement
- A strategy
- A discipline – DMAIC
- Define critical outputs and identify gaps for improvement
- Measure the work and collect process data
- Analyze the data
- Improve the process
- Control the new process to make sure new performance is maintained
Seven Concepts of TQM:Employee Empowerment
Getting employees involved in product and process improvements
-85% of quality problems are due to process and material
Techniques
- Build communication networks that include employees
- Develop open, supportive supervisors
- Move responsibility to employees
- Build a high-morale organization
- Create formal team structuresSeven Concepts of TQM:Quality Circles
Group of employees who meet regularly to solve problems
Trained in planning, problem solving, and statistical methods
Often led by a facilitator
Very effective when done properly
Seven Concepts of TQM: 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
Seven Concepts of TQM: Just-In-Time (JIT)
‘Pull’ system of production scheduling including supply management
–Production only when signaled
Allows reduced inventory levels
–Inventory costs money and hides process and material problems
Encourages improved process and product quality
