Product Lifecycle ManagementProduct Lifecycle ManagementCost of QualityPasi Kaipainen, Mika Huhta

Cost of Quality Management Cost of Quality Management

is an approach to reducing the Cost of Quality (COQ), the sum of all costs incurred throughout the product lifecycle due to poor quality

Cost of Quality Management Cost of Quality Management

COQ is made up of 4 types of quality costs:1. internal failure costs2. external failure costs3. appraisal costs4. prevention costs

Internal failure costs Internal failure costs

Failures such as rework, scrap and poor design that customer does not see

External failure costs External failure costs

Failures which occur after the product has been delivered to the customer. Includes warranty claims, product liability claims and field returns

Appraisal costs Appraisal costs

Costs coming from measuring quality and maintaining conformance by such activities as inspection, testing, process monitoring and equipment calibration

Prevention costs Prevention costs

Costs coming from reducing the failure and appraisal costs and to achieve first-time quality. E.g. education, training and supplier certification

Six Sigma Six Sigma

Six Sigma is a set of practices originally developed by Motorola to systematically improve processes by eliminating defects

Six Sigma has two key methodologies: DMAIC (Define-Measure-Analyze-Improve-Control) DMADV (Define-Measure-Analyze-Design-Verify)

DMAIC is used to improve an existing business process, and DMADV is used to create new product or process designs for predictable, defect-free performance.

Six Sigma Six Sigma

DMADV has several variations (DMEDI, DMADOV and so on …)

Six Sigma-DMAIC Six Sigma-DMAIC Define the process improvement goals that are

consistent with customer demands and enterprise strategy.

Measure the current process and collect relevant data for future comparison.

Analyze to verify relationship and causality of factors. Determine what the relationship is, and attempt to ensure that all factors have been considered.

Improve or optimize the process based upon the analysis using techniques like Design of Experiments.

Control to ensure that any variances are corrected before they result in defects. Set up pilot runs to establish process capability, transition to production and thereafter continuously measure the process and institute control mechanisms.

Six Sigma-DMADVSix Sigma-DMADV Define the goals of the design activity that are

consistent with customer demands and enterprise strategy.

Measure and identify CTQs (critical to qualities), product capabilities, production process capability, and risk assessments.

Analyze to develop and design alternatives, create high-level design and evaluate design capability to select the best design.

Design details, optimize the design, and plan for design verification. This phase may require simulations.

Verify the design, set up pilot runs, implement production process and handover to process owners.

DMAIC cycleDMAIC cyclehttp://quality.dlsu.edu.ph/tools/DMAIC_cycle.pdf

SigmaSigma

The value of the process standard deviation for a given characteristic. Sigma is used to quantify the spread (around a mean) of some process or product characteristic.

LSL USL

SigmaSigma

99.9999998% of the data fallswithin 6 sigmas from the mean.

6X

Sigma Level Defects per million opportunities

1 690,000

2 308,537

3 66,807

4 6,210

5 233

6 3.4

68.26%

99.73%

99.9999998%

DFSSDFSS

DFSS:Design For Six Sigma Six sigma tools were initially deployed for the

improvement of existing manufacturing or service processes.

When new designs were introduced similar Six Sigma solutions were found to be deployed to similar problems again and again.

six sigma problem-solving techniques needed to be incorporated into the design process.

DFSSDFSS

ProcessDesign

Engineering Procurement Construction/Build

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% o

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DFSS-DefinitionDFSS-Definition

SSustainIInitiate DDesign EExecute aand

TM/SM

InitiateInitiate•Define and quantify customer requirements.

•Examine the project fit with business operating and strategic plan.

•Perform a business and technical risk assessment.

•Perform a marketing and competitive assessment.

•Perform a financial assessment —sensitivity analysis.

•Create a cross-functional team.

•Determine the timeline.

DesignDesign•Develop transfer functions.

•Perform a tolerance analysis.

•Design for manufacturability/ reliability.

•Pilot and prototype.

•Perform an intellectual property review.

•Perform a risk analysis.

•Perform a cost/investment review.

•Review the timeline.

•Develop a part/raw material procurement plan.

ExecuteExecute•Procure needed equipment and software.

•Set up manufacturing for production.

•Execute a commercialization plan.

•Start up production.

•Initiate a control plan.

•Demonstrate short-term manufacturing capability.

•Verify the short-term risk

SustainSustain•Maintain the control plan.

•Implement the quality management system.

•Review actual vs. estimated results.

•Use MAIC projects as needed to close gaps.

•Demonstrate long-term performance capability.

•Close the project.

Process ControlProcess Control

•Cp (and Cpk) is the short-term capability index

•It is the potential, inherent process capability, or the best the process could ever hope to perform in short-term

•Pp (and Ppk ) is the long-term performance index

•It is also called Process Performance

•It is the actual, long-term performance of the process in real life

Process ControlProcess ControlProcess capability indexCp

Mean value= Nominal value or

Target

- 3s + 3s

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Voice of the Customer

Voice of the Process

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Voice of the CustomerCp = -------------------------------------

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Process capability index Cpk• Cpk takes into account any difference between the design

nominal and the actual process mean value x

LSL USL

Process Capability IndexCpk

NominalNominalvaluevalue

-- 33 ssSTST + 3+ 3 ssSTST

LSLLSL USLUSLLCLLCL UCLUCL

MeanMeanvaluevalue

xx

1.33 < Cp < 2.00, but 1.00 < Cpk < 1.331.33 < Cp < 2.00, but 1.00 < Cpk < 1.33

Process Capability exampleProcess Capability example•PPAP (Production Part Approval Process, Automotive Industry Action Group (AIAG), 1995 states:

PLM and Six SigmaPLM and Six Sigma

Combine PLM and Six Sigma initiatives together could help to reach targets more effectively since business investments are quite similar for both PLM and Six Sigma.

PLM and Six SigmaPLM and Six Sigma

Proven Benefits of Six Sigma Proven Benefits of PLM

Productivity increases Cycle time reduction Higher throughput Reduced defects High levels of outgoing quality Standardized improvement methodology

across the organization A set of techniques and tools to simplify

improvement efforts Greater customer satisfaction and dramatic

improvement to the "bottom-line". Improve/reengineered processes

Productivity increases Cycle time reduction Higher throughput Reduced defects High levels of outgoing quality Fast easy access to information 100% BOM accuracy Controlled access Improved collaboration with customer Improved Reuse Technology to simplify and control

improvement efforts Greater customer satisfaction and

improvement to the "bottom-line" Effective and efficient process control not

possible otherwise