Professional Documents
Culture Documents
Operations Management
William J. Stevenson
8th edition
7-2 Management of Quality
Quality Management
• Quality Assurance
• Emphasis on finding and correcting defects
before reaching market
• Strategic Approach
• Proactive, focusing on preventing mistakes
from occurring
• Greater emphasis on customer satisfaction
7-5 Management of Quality
• Armand Feignbaum
• Philip B. Crosby
• Kaoru Ishikawa
• Genichi Taguchi
7-6 Management of Quality
Quality
7-7 Management of Quality
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
customer’s expectations
• Reliability - consistency of performance
7-8 Management of Quality
Service Quality
• Tangibles
• Convenience
• Reliability
• Responsiveness
• Time
• Assurance
• Courtesy
7-12 Management of Quality
Dimension Examples
1. Tangibles Were the facilities clean, personnel neat?
Determinants of Quality
Ease of
Design
use
Conforms
to design Service
7-14 Management of Quality
• Productivity
• Costs
7-16 Management of Quality
• Top management
• Design
• Procurement
• Production/operations
• Quality assurance
• Packaging and shipping
• Marketing and sales
• Customer service
7-17 Management of Quality
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.
7-18 Management of Quality
• Appraisal Costs
• Costs of activities designed to ensure quality
or uncover defects
• Prevention Costs
• All TQ training, TQ planning, customer
assessment, process control, and quality
improvement costs to prevent defects from
occurring
7-19 Management of Quality
• Substandard work
• Defective products
• Substandard service
• Poor designs
• Shoddy workmanship
Quality Awards
Baldrige Award
Deming Prize
7-21 Management of Quality
• Financial success
• Winners share their knowledge
• Results orientation
7-24 Management of Quality
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 company’s environmental performance
7-26 Management of Quality
Requirements
• System requirements
• Management
• Resource
• Realization
• Remedial
7-27
ISO 9000 Quality Management
Management of Quality
Principles
• A systems approach to management
• Continual improvement
• Factual approach to decision making
• Mutually beneficial supplier relationships
• Customer focus
• Leadership
• People involvement
• Process approach
7-28 Management of Quality
ISO 14000
• Environmental systems
7-29 Management of Quality
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
7-30 Management of Quality
T Q M
7-31 Management of Quality
Elements of TQM
• Continual improvement
• Competitive benchmarking
• Employee empowerment
• Team approach
• Decisions based on facts
• Knowledge of tools
• Supplier quality
• Champion
• Quality at the source
• Suppliers
7-33 Management of Quality
Continuous Improvement
• Philosophy that seeks to make never-ending
improvements to the process of converting
inputs into outputs.
• Kaizen: Japanese
word for continuous
improvement.
7-34 Management of Quality
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
7-36 Management of Quality
• Employed in
• Design
• Production
• Service
• Inventory management
• Delivery
7-37 Management of Quality
• Top management
• Program champions
• “Black belts”
• “Green belts”
7-40 Management of Quality
• Define
• Measure
• Analyze
• Improve DMAIC
• Control
7-41 Management of Quality
• Lack of:
• Company-wide definition of quality
• Strategic plan for change
• Customer focus
• Real employee empowerment
• Strong strong motivation
• Time to devote to quality initiatives
• Leadership
7-42 Management of Quality
Criticisms of TQM
Act
Do
Study
7-46 Management of Quality
Process Improvement
• Process Improvement: A systematic
approach to improving a process
• Process mapping
Document
Study/document
Evaluate
Seek ways to
Implement the
Improve it
Improved process
Design an
Improved process
7-48 Management of Quality
Check Sheet
Wrong Amount
A/R Errors
Wrong Account
Wrong Amount
7-51 Management of Quality
Pareto Analysis
80%
80% ofof the
the
problems
problems
may
may be
be
attributed
attributed to
Number of defects
to
20%
20% ofof the
the
causes.
causes.
Control Chart
Figure 7.11
1020
UCL
1010
1000
990
980
LCL
970
0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15
7-53 Management of Quality
Cause-and-Effect Diagram
Figure 7.12
Methods Materials
Cause
Cause
Cause
Cause
Cause Cause
Environment Effect
Cause Cause
Cause Cause
Cause Cause
People Equipment
7-54 Management of Quality
Run Chart
0.58
0.56
Diameter
0.54
0.52
0.5
0.48
0.46
0.44
1 2 3 4 5 6 7 8 9 10 11 12
Time (Ho urs )
Time (Hours)
7-55 Management of Quality
Tracking Improvements
Figure 7-17
UCL UCL
UCL
LCL
LCL
Additional improvements
LCL Process centered made to the process
Process not centered and stable
and not stable
7-56 Management of Quality
• Brainstorming
• Quality circles
• Interviewing
• Benchmarking
• 5W2H
7-57 Management of Quality
Quality Circles
• Team approach
• List reduction
• Balance sheet
• Paired comparisons
7-58 Management of Quality
Benchmarking Process
• Identify a critical process that needs improving
• Identify an organization that excels in this
process
• Contact that organization