ASSIGNMENTQ1. Briefly explain the contributions of Deming, Juran, Crosby and Taguchi in the advancement of our understanding of Quality.

Ans. Quality is described in terms of various general definitions and dimensions. The costs of quality are presented. The seven most commonly used tools of quality control are presented and discussed. The Baldrige Award and several certification programs are discussed. The contributions of several quality gurus Deming, Juran Crosby, Shewhart, Feigenbaum, Ishikawa, and Taguchi are presented. Finally, the reasons for TQM failures are presented. Answers to Discussion Questions in Textbook 1. Define quality for the following products: a university, an exercise facility, spaghetti sauce, and toothpaste. Compare your definitions with those of others in your class. The quality of a university can be defined as: quality of professors have Ph.D., helpful, knowledgeable, able to clearly explain material, fair ability to place students in a good position at a high salary in a timely manner facilities are up-to-date in terms of technology (i.e. wireless classrooms) value for the price of the education ability to prepare students for success in the business world variety of course offerings efficiency and accuracy of processing paperwork, such as registration for classes appearance of the campus perceived prestige of the university

The quality of an exercise facility can be defined as: variety of gym equipment variety and availability of fitness classes value for the price of membership ability to help members get into shape accurate billing atmosphere meets members needs waiting times for machines are two minutes or less

The quality of spaghetti sauce can be defined as: good taste the jar is filled to 28 ounces plus or minus one ounce value for price paid perceived quality of the product ability to quickly answer questions at the address listed on the jar of sauce the sauce has chunks of tomatoes ease of opening jar ease of preparing the sauce to eat able to keep leftover sauce in container in refrigerator easily to last longer length of time the sauce can still be eaten

The quality of toothpaste can be defined as: ability to clean teeth good taste perceived quality of the product ability to keep breath fresh ability to prevent plaque ability to whiten teeth ability to prevent cavities tube of toothpaste is filled

ability to fight gingivitis ability to fight tartar able to quickly and accurately answer questions in a friendly manner at the toll-free number listed on toothpaste tube tube is filled with 4.2 ounces plus or minus 0.5 ounce. toothpaste is certified by the American Dental Association (ADA)

2. Describe the TQM philosophy and identify its major characteristics. TQM focuses on identifying the causes of quality problems and correcting these problems. TQM emphasizes the need to include every employee in the organization in the quality improvement efforts. TQM emphasizes the need to define quality based on the customers needs. Its major characteristics are customer focus, continuous improvement, quality at the source, employee empowerment, understanding quality tools, a team approach, benchmarking and managing supplier quality.

3. Explain how TQM is different from the traditional notions of quality. Also, explain the differences between traditional organizations and those that have implemented TQM. Traditional notions of quality focused on inspection of products. Instead of relying on inspection as the primary tool for quality, TQM focuses on identifying the causes of quality problems and correcting these problems. TQM takes a broader view of the organization than traditional views of quality. Organizations that implemented TQM successfully were able to produce a higher quality product at a lower price, thereby increasing market share. Traditional organizations have either failed or will fail in the future if quality is poor.

4. Find three local companies that you believe exhibit high quality. Next find three national or international companies that are recognized for their quality achievements.

The selection of the local companies will depend on the location of the university utilizing this textbook. The Ritz-Carlton Hotel Company, a winner of the Malcolm Baldrige National Quality Award, is known for outstanding customer service. Its employees are trained well and are empowered to deal with quality problems on the spot. Florida Power & Light (FPL) was the first American company to win Japans Deming Prize, which is a prestigious quality award. FPL has created and used a process for identifying and dealing with quality problems that has been benchmarked by a number of companies. For example, FPL applied this process to the problem of service interruptions to determine the major causes. They made changes based on the analysis, such as moving power poles away from dangerous curves in the road to deal with one important cause (Florida Power Light Quality Improvement (Q1) Story Exercise (A), Harvard Business School Case 9-689-041). Disney is well-respected for its customer focus. Disney has theme parks in the U.S., Japan and Europe. Disney is known for its excellent training program and attention to details.

5. Describe the four dimensions of quality. Which do you think is most important? The four dimensions of quality are the quality of product or service design, quality of conformance to design, ease of use and post-sales service. The quality of product or service design is determined by the features that are included in the final design of the product or service. The quality of conformance to design is the result of how well the product or service meets its specifications. Ease of use is determined by the ease of using the product or service, its reliability and its maintainability. Post-sales service is the level of service provided after the product or service has been purchased. The four dimensions of quality are all important in determining quality. However, quality of design is most important since it determines the ability to meet customer needs, which is the objective. If the quality of design does not meet customer needs, then it will not matter if the product or service meets it design specifications, is easy to use or is supported by good postsale service.

6. Describe each of the four costs of quality: prevention, appraisal, internal failure, and external failure. to manufacture. Prevention costs are the costs associated with preventing poor quality, such as training, designing a quality product that is easy to manufacture and planning costs. Appraisal costs are the costs of determining the level of quality and finding defects. These costs include inspections, product testing and quality audits. Internal failure costs are the costs associated with finding and dealing with quality problems discovered before the product or service reaches the customer. Some examples of internal failure costs are rework, scrap and machine downtime due to quality problems. External failure costs are the costs of poor quality discovered by the customer. Some examples of external failure costs are product returns, lawsuits and repairs. If we designed a higher quality product that was easier to manufacture, then both internal and external failure costs would decrease since we would produce less defective product. Appraisal costs would probably decrease since we may be able to reduce inspections and quality audits. Prevention costs would increase since we expended effort to design a better quality product. Next, describe how each type of cost would change (increase, decrease or remain the same) if we designed a higher quality product that was easier

7. Think again about the four costs of quality. Describe how each would change if we hired more inspectors without changing other aspects of quality. If we hired more inspectors without changing other aspects of quality, then we would still produce the same number of defects. However, we would find more, but not necessarily all, of these defects before they reach the customer. Therefore, internal failure costs will increase, while external failure costs will decrease. Appraisal costs would increase since we are now paying for more inspectors. Prevention costs would remain the same since we did not change other aspects of quality.

8. Explain the meaning of the Plan-do-study-act cycle. Why is it described as a cycle?

The Plan-do-study-act cycle is a procedure for continuous improvement. problems. Next, the plan is implemented.

First, a plan is

developed after we have documented procedures, collected data and identified We then study the results of our implementation. Finally, we act based on the results. It is described as a cycle since it is an ongoing process or series of steps that is repeated.

9. Describe the use of quality function deployment (QFD). Can you find examples in which the voice of the customer was not translated properly into technical requirements? QFD is a tool for matching customer requirements to technical requirements. This tool incorporates the customer requirements, the relative importance of the customer requirements, the technical requirements (how we can meet customer requirements), the strength and type of relationships between the customer and technical requirements, the relationships or trade-offs between the different technical requirements and the ratings of the ability of competitors and our company to meet customer requirements into one diagram in order to evaluate all this information in an integrated manner. In the airline industry, low prices and direct, non-stop flights are two important customer requirements. Most airlines have focused on developing a hub-and-spoke system in order to improve efficiencies. A hub-and-spoke system is one in which many flights stop at a hub city, such as Atlanta, before continuing on to the final destinations, or the spokes. This limits the ability of the customers to find a direct, non-stop flight to their destination, thus increasing travel time.

10. Describe the seven tools of quality control. Are some more important than others? Would you use these tools separately or together? Give some examples of tools that could be used together. The seven tools of quality control are the cause-an-effect diagram, flowchart, checklist, control chart, scatter diagram, Pareto chart and histogram. The cause-and-effect diagram, or fishbone diagram, shows all possible causes of one quality problem or defect type (effect), where the causes are separated into categories (or bones) on the diagram. It is used as a brainstorming

tool to determine which causes to investigate. The flowchart documents the flow of the materials or customer through the steps of the process. The checklist lists the type of defects, along with a tally of the frequency of each type. Control charts show plots of samples of a product or service characteristic taken from the process over time. The control chart helps us determine whether the process is in control, which means that only random variation exists. Scatter diagrams are plots on an x-y axis used to determine the relationship between two variables. Pareto charts show the frequency and cumulative percentages of defect types arranged from most frequent to least frequent defect types. This chart demonstrates which defect types cause the majority of the quality problems or complaints. A histogram shows the frequency of each quality problem. The Pareto chart and cause-and-effect diagram can be effectively used in combination. First, the Pareto chart is used to identify the problem(s) that cause the highest number of actual defects or complaints. Next, a common problem becomes the effect on the cause-and-effect diagram. This diagram then helps us identify causes to investigate in order to solve the problem.

11. What is the Malcolm Baldrige National Quality Award? important, and what companies have received it in the past?

Why is this award

The Malcolm Baldrige National Quality Award (MBNQA) is an award that was created by U.S. Congress in 1987 to promote quality and improve the trade deficit. The award is important because it provides an effective framework for improving quality. Many companies have used the MBNQA framework to improve quality, without an intention of applying for the award. Some of the companies that have received it are Motorola, AT&T, Xerox, Federal Express and Ritz-Carlton.

12. What are ISO 9000 standards? Who were they set by and why? Can you describe other certifications based on the ISO 9000 certification? ISO 9000 is a set of standards and a certification program for companies based on a documentation of the quality processes. The standards were set by the International

Organization for Standardization to set a standard for companies doing business. ISO 14000 is a set of standards that focuses on environmental concerns. QS 9000 is a set of standards based on ISO 9000 that is geared to the automobile industry.

13. Who are the three gurus of quality control? Name at least one contribution made by each of them. The three gurus are Deming, Juran and Crosby. Deming helped management understand that most quality problems are caused by the processes and systems, not the workers. Deming motivated the usage of statistical quality control tools for differentiating between common and special causes of variation. Juran contributed to the quality movement by creating a focus on the definition and costs of quality. Crosbys contribution is a result of his argument that quality is free, which is based on that idea that many costs of quality are hard to quantify.

Q2. (a)

Briefly explain ISO: 9000 series and 14000 series. Discuss the

advantages of ISO certification.The International Organization of Standardization (ISO) is a worldwide federation consisting of member bodies from 91 countries, which promotes the development of international manufacturing, trade and communication standards. ISO 9000 refers to a generic series of standards published by the ISO that provide quality assurance requirements and quality management guidance. ISO 9000 is a quality system standard, not a technical product standard. The ISO 9000 series currently contains four standards - ISO 9001, ISO 9002, ISO 9003 and ISO 9004. Firms select the standard that is most relevant to their business activities. However, these four standards will be revised in late 2000. More information is provided later in this paper under ISO 9000:2000. ISO 14000 refers to a series of standards on environmental management tools and systems. ISO 14000 deals with a company's system for managing its day-to-day operations and how they impact the environment. The Environmental Management System and Environmental Auditing address a wide range of issues to include the following:

1. Top management commitment to continuous improvement, compliance, and pollution prevention. 2. Creating and implementing environmental policies, including setting and meeting appropriate targets. 3. Integrating environmental considerations in operating procedures. 4. Training employees in regard to their environmental obligations. 5. Conducting audits of the environmental management system. ISO 9000 and ISO 14000 are tools to assist business and government to insure the quality of their products and services, and to manage the impact of their activities on the environment. Like all ISO standards, their use is voluntary unless a business sector makes them a market requirement or a government issues regulations making their use obligatory. Organizations that implement ISO 9000 and ISO 14000 voluntarily do so to improve operations and provide real benefits. Why Consider ISO 9000 Registration There are several benefits to implementing this series in your company. There is also a strong belief that having a documented quality procedure gives a firm a strong advantage over its competitors. For example, it will guide you to build quality into your product or service and avoid costly after-the-fact inspections, warranty costs, and rework. Most importantly, more contractors are working with ISO certified customers every year as the certifications are more widely used and accepted in the United States. Becoming ISO Certified or Registered In order to become certified or registered (either term may be used) for three years, companies must be audited by a third-party registrar to make sure they comply with all of the elements of the standard. A registrar is a third-party company that is contracted to evaluate an organization's

quality management system to the requirements of the ISO 9000/14000 Standards. For a list of accredited registrars contact: Registrar Accreditation Board (RAB) Phone: (888) 722-2440 or (414) 272-3937 Fax: (414) 765-8661, or Email: www.rabnet.com Typically, contracting firms apply for registration under 9001 if a contractor performs design work or 9002 if they just install work. In the case of the 9001 Standard, there are 20 elements covering such items as management responsibility, quality system, contract review, design control, document and data control and purchasing. The auditing process takes an average of 12-24 months if the firm currently uses a quality system. Consultants can be hired to assist a firm in preparing for the audit. Using a consultant to help a firm prepare for registration is not required; however, research on certification shows an initial ISO 9000 series failure rate of 60% for companies that try to prepare without outside consulting help. The cost of certification varies depending on the size and sophistication of a company. Some rough estimates are: Certification Consulting $25,000 - $80,000 Certification Registrar $10,000 - $30, 000 Registrars typically perform an initial visit, two-three day preliminary audit and then a four-day final audit. Once a firm is registered, there are also some costs involved for surveillance audits, which occur every six months and the re-audit process every three years. Additionally, each firm must have an internal audit team for continuous improvement and auditing. Though the investment of time, money and staff resources are considerable in the ISO 9000/14000 certification process, most certified firms report returns on their investment through

monetary savings, marketing advantages and better procedures and information to help them to continue to reduce costs and waste in their firms. Approval When a firm is approved, they receive a certificate of registration for the facility registered and ISO standard used. They can then use the certificate number and symbol on advertising and correspondence. The registrar lists them in its directory identifying facility locations, ISO standard used and certificate number. For continued certification, they should expect registrar surveillance audits about every six months and a re-audit every three years. Changes Planned to ISO 9000 in 2000 The International Standards Organization (ISO) periodically reviews the ISO 9000 Standards to ensure they are current and relative to the needs of industry. As a result from feedback of the 1994 version of the standard, a new draft standard called ISO 9000:2000 is currently under review and is expected to be released in the last 3 months of 2000. Key needs addressed in the new standard include: 1. A process or whole system approach 2. Compatibility with other management systems likes ISO 14000 3. Continuous improvement 4. Stakeholder needs 5. User friendly language What is expected to change when the new draft if approved can only be considered as tentative at this time. The following items are most likely to change when the ISO 9000 is finalized. 1. The current series has 20 published standards. The proposed new model will have a mere four, which are: a. ISO 9000 - Concepts and Terminology

b. ISO 9001 - Model for Quality Assurance c. ISO 9004 - Model for Quality Management d. ISO 10011 - Guidelines for Auditing Quality Systems 2. Many elements of the 20 standards will be folded into the core set. Additionally, once ISO 9001:2000 Standard, the standard that applies to contracting firms is finalized, it will replace the need/use of ISO 9002 and ISO 9003 in this standard. This new standard will be flexible enough to incorporate all three previous standards into one. 3. The biggest change in the ISO 9001:2000 will be a new emphasis on the closed loop process. The revised standard is designed to place more emphasis upon "the processes" of a business, rather than being "system" based. This means emphasis is placed on the plan, do, check-act model already incorporated in ISO14001, the environmental standard.

What is ISO? The abbreviation ISO stands for International Organization for Standardization. ISO is a series of international standards introduced in 1987 that define and structure a companys management systems. These standards apply equally to all industries and require companies seeking certification to define how their systems meet the standards rigorous requirements. Meeting the standards assures customers that all vendor company activities design, manufacturing, production, purchasing, quality control, packaging, handling, storage, shipping, and customer service are appropriately managed and controlled. What is the difference between ISO 9000 and 14000?

ISO 9000 is concerned with "quality management. This means what the organization does to enhance customer satisfaction by meeting customer and applicable regulatory requirements and continually improving its performance in this regard. ISO 14000 is primarily concerned with "environmental management. This means what the organization does to minimize harmful effects on the environment caused by its activities and continually improving its environmental performance. Can any vendor be ISO-certified? Yes. There are approximately 250,000 companies worldwide registered to ISO standards. Any company willing to make the effort can be certified. Why should I require vendors to be ISO-certified?

ISO is direct evidence of a company's financial and ethical commitment to provide high quality, safe products. ISO certified companies maintain comprehensive internal audit programs that demonstrate to customers the effectiveness of their quality and environmental efforts.

ISO certified companies utilize systems that have been accepted for use by over 80 countries as effective means to achieve product quality and environmental stewardship.

ISO certified companies document, review, and approve product designs that meet applicable safety, regulatory, and customer requirements.

ISO certified companies prove their systems through audits by independent registrars. Registrars are governed by strict international codes that dictate operating practices, audit methods, and staff qualifications. Failure to maintain quality program requirements will lead to de-certification by the registrar.

ISO certified company products reduce the need for the buyers to perform audits and reviews to determine if quality systems are in place and being maintained.

A certificate of analysis from an ISO certified company will be supported by documented procedures and records that demonstrate its validity. This is particularly important should a customer ever have a reason to question product quality.

(b) An inspector counted the number of defective monthly billing statements of a company telephone in each of 20 samples. Using following information construct a control chart that will describe 99.74% of the chance variation in the process when the process is in control. Each sample contained 100 statements. Value of Z=3.00.Sam ple 1 2 3 4 5 6 7 8 9 10 No. of defectives 4 10 12 3 9 11 10 22 13 10 Sam ple 11 12 13 14 15 16 17 18 19 20 No. of defectives 8 12 9 10 21 10 8 12 10 6

Solution : From samples, we obtain p = Total number of defectives Total number of observations = 220 20 (100) = 0.11 p = p(1 p) n = 0.11(1 0.11) 100 = 0.03

From a normal distribution table, we see that 99.74% of any normal distribution is contained within 3 standard deviations away from the mean. In other words, the probabilities that the normal variable is less than 3 standard deviation and that it is more than 3 standard deviation are both Normdist(3,0,1,1) = 1 Normdist(3,0,1,1) = 0.0013 = (1 0.9974)/2. Then, the control limits are UCLp = p + z(p)=0.11 + 3(0.03) = 0.20, LCLp = p z(p)=0.11 3(0.03) = 0.02. b) You can see that the process is not in control: sample 8 (22/100 = .22)and sample 15 (21/100 = .21) are above the upper control limit. The process would be stopped at those points to find and correct the causes. c) The p-control chart does not change because p and n remain the same after correctly disributing the defective bills to the samples. However, now all the samples have fewer than 20 defectives so the process is in control.