Management of Quality Chapter 9 PP. 233-270 June 27, 2012.
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Transcript of Management of Quality Chapter 9 PP. 233-270 June 27, 2012.
Management of Quality
Chapter 9PP. 233-270
June 27, 2012
Learning objectives
• LO 1 – define the term quality• LO 2 – understand the evolution of quality
management• LO 3 – be familiar with most common quality
tools• LO 4 – understand the cost of quality
What is Quality?
• Oxford American Dictionary– a degree or level of excellence
• American Society for Quality– the totality of features and characteristics that
satisfy needs without deficiencies
What is Quality?
• Consumer’s perspective– Fitness for use– Quality of design
What is Quality?
• Manufacturer’s perspective– Performance• mpg
– Features• Sirrius, OnStar
– Reliability• Expected life time
– Conformance• Meets standards
What is Quality?• Manufacturer’s perspective– Durability• LL Bean boots
– Serviceability• Repair “experience”
– Aesthetics• looks
– Safety• customers
– Perceptions• Brand and image
What is Quality?
• Service’s perspective– Time and timeliness• When customer wants it
– Completeness• Dell
– Courtesy• Shown customers
– Consistency– Accessibility and convenience– Accuracy– Responsiveness
What is Quality?
• Service’s perspective– Consistency• McDonalds
– Accessibility and convenience• Return calls• Sears!!!!
– Accuracy• First time, every time
– Responsiveness• To your satisfaction?
What is Quality
• At the end of the day……– Customer’s and producer’s perspectives depend
on each other• Producer’s perspective:– production process and COST
• Customer’s perspective:– fitness for use and PRICE
• Customer’s view must dominate
The Gurus• Deming– Quality up, costs up– Quality down, costs down
–Quality up, costs down
The Gurus• Deming– Open system– Focus on quality• less waste• rework• lower turnover• greater customer loyalty
– Focus on costs• quality declines• opposite of above
The Gurus• 14 Principles– #3: “quality at the source”
• 7 Deadly sins– Lack of constancy of purpose– Emphasis on short-term profits– Performance reviews, merit rating, etc– Mobility of management– Running a company on visible figures alone– Excessive medical costs– Excessive costs of warranty
The Deming (PDCA) Cycle
Quality Tools
• Process flow chart
Quality Tools
• Process flow chart• Check sheet• Histogram • Pareto analysis
Quality Tools - Pareto Analysis
Quality Tools
• Process flow chart• Check sheet• Histogram • Pareto analysis• Scatter diagram• Process control chart
Quality Tools – Control Chart
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Quality Tools
• Process flow chart• Check sheet• Histogram • Pareto analysis• Scatter diagram• Process control chart• Fishbone (“cause and effect”)
Quality Tools – Fishbone
Quality Awards
• Baldrige Award• http://www.youtube.com/watch?v=Ng8YrYiI8V
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Quality Certification
• ISO 9000• ISO 14000• ISO 24700• ISO 26000
Six Sigma• measurement-based strategy for process
improvement and variation reduction• Focus on:– improving existing system – developing new processes or products at Six
Sigma quality levels. • $230,000 savings per project– 4-6 projects per year. – General Electric $10 billion during the first fivea.
Six Sigma Projects
• Large chemical site had significant losses due to power outages
• Large number of changes from client after approving engineering design
• Amount of product out of spec and being automatically removed is high
• Sharp differences in sales performance of people?
Variation in Sales Performance
• Define: Why is there such a difference is the sales performance of people?
• Measure: Top people have 10X volume of the bottom 25%. – Failure to meet sales quotas is a defect.
Variation in Sales Performance
• Analyze: Education, training, time in job, product line, sales area, profiles.
• Improve: Able to identify by profile 72% of the top sales people. – Use this tool to select new people into this
function.• Control: Use profiles for new hires and
continue to monitor performance levels.
Six Sigma
Why bother???
•cost of doing things right•3 to 4% of revenues
•cost of doing things wrong•20 to 35% of revenues
•And then there’s this………•http://www.youtube.com/watch?v=7rUQbTsc_ms