2Chapter Overview Recognizing Different Perspectives on Quality What is Quality?Differing Functional Perspectives on QualityThe Three Spheres of QualityOther Perspectives on QualityArriving at a Common Understanding of Quality using a Contingency Perspective of Quality
3Recognizing Different Perspectives on Quality There are many different definitions and dimensions of quality.For the present, you should view quality as a measure of goodness that is inherent to a product or service.Employees working for the same firm often view quality differently as illustrated in the next slide.Perceptions on Quality Can VaryIn order to communicate effectively about quality, managers need to recognize that differences in perceptions of quality exist.
4What Is Quality? Garvin’s Definitions of Quality David Garvin of the Harvard Business School found that most definitions of quality were either transcendent, product-based, user-based, manufacturing-based, or value-based.Garvin’s Dimensions of Product QualityUsing the five definitions of quality, Garvin developed a list of eight quality dimensions.Service Quality DimensionsParasuraman, Zeithamel, and Berry of Texas A&M University published a widely recognized set of service quality dimensions.
5Garvin’s Definitions of Quality Slide 1 of 2 Transcendent DefinitionQuality is something that is intuitively understood but nearly impossible to communicate such as beauty or love.Product-Based DefinitionQuality is found in the components and attributes of a product.User-Based DefinitionIf the customer is satisfied, the product has good quality.
6Garvin’s Definitions of Quality Slide 2 of 2 Manufacturing Based DefinitionIf the product conforms to design specifications, it has good quality.Value-Based DefinitionIf the product is perceived as providing good value for the price, it has good quality.
7Garvin’s Product Quality Dimensions Slide 1 of 3 PerformanceFeaturesDurabilityReliabilityServiceabilityConformanceAestheticsPerceived Quality
8Garvin’s Product Quality Dimensions Slide 2 of 3 PerformanceRefers to the efficiency with which a product achieves its intended purpose.FeaturesAttributes of a product that supplement a product’s basic performance.ReliabilityThe propensity for a product to perform consistently over its useful design life.ConformanceNumerical dimensions for a product’s performance, such as capacity, speed, size, durability, color, or the like.
9Garvin’s Product Quality Dimensions Slide 3 of 3 DurabilityThe degree to which a product tolerates stress or trauma without failing.ServiceabilityEase of repair.AestheticsSubjective sensory characteristics such as taste, feel, sound, look, and smell.Perceived QualityBased on customer opinion. Customers imbue products and services with their understanding of their goodness.
10Service Quality Dimensions Slide 1 of 3 Parasuraman, Zeithamel, and Berry’s Service Quality DimensionsTangiblesResponsivenessService ReliabilityAssuranceEmpathy
11Service Quality Dimensions Slide 2 of 3 TangiblesInclude the physical appearance of the service facility, the equipment, the personnel, and the communication material.Service ReliabilityDiffers from product reliability in that it relates to the ability of the service provider to perform the promised service dependably and accurately.ResponsivenessThe willingness of the service provider to be helpful and prompt in providing service.
12Service Quality Dimensions Slide 3 of 3 AssuranceThe knowledge and courtesy of employees and their ability to inspire trust and confidence.EmpathyCaring, individual attention paid to customers by the service firm.
13Why Does It Matter That Difference Definitions of Quality Exist? Understanding that definitions and dimensions of quality exist allows measures to be taken to provide a better basis for communication and planning in a firm.
15Engineering Perspective on Quality Slide 1 of 4 Nature of Engineering PerspectiveEngineers are interested in applying mathematical problem solving skills and models to the problems of business and industry.Two of the major emphases in engineeringProduct designProcess design
16Engineering Perspective on Quality Slide 2 of 4 Product Design EngineeringInvolves all of those activities associated with developing a product from concept development to final design and implementation.Product design life cycleKey to quality as quality is assured at the design stage.Concurrent engineeringThe simultaneous performance of product and process design activities.Has resulted in improved quality and faster speed to market for new products.
17Engineering Perspective on Quality Slide 3 of 4 Product Design Life CycleFigure 1.1IdeaGenerationPrototypeIterationsPreliminaryDesignPrototypeDevelopmentFinalDefinitionProductDesign &EvaluationImplemen-tation
18Engineering Perspective on Quality Slide 4 of 4 Related ConceptsLife TestingIs a facet of reliability engineering that concerns itself with determining whether a product will fail under controlled conditions during a specified life.RedundancyIs applied so that a back up system can take over for the failed primary system.Statistical Process ControlIs concerned with monitoring process capability and process stability.
19Operations Perspective on Quality Slide 1 of 6 Nature of Operations PerspectiveThe operations management view of quality is rooted in the engineering approach.Like engineers, operations managers are very concerned about product and process design.However, rather than focusing on only the technical aspects of these activities, operations concentrates of the management of these activities.Operations management has developed into an integrative field, combining concepts from engineering, operations research, organizational theory, organizational behavior, and strategic management.
20Operations Perspective on Quality Slide 2 of 6 Systems ViewOperations management utilizes the systems view to address quality problems that underlies modern quality management thinking.The systems view involves the understanding that product quality is the result of the interactions of several variables such as machines, labor, procedures, planning, and management.
21Operations Perspective on Quality Slide 3 of 6 The Systems View of Operation ManagementFigure 1.3PlanningOrganizingInputsConversionProcessOutputsCustomersFeedbackControlling
22Operations Perspective on Quality Slide 4 of 6 Operations/Marketing InterfaceIn recent years, a major advance in operations management has been the improved understanding of the operations/marketing interface.The interface has resulted in an increased focus on the customer.This externalized view is important as operations managers in firms still tend to be focused heavily on meeting production schedules, sometimes at the expense of good quality.
23Operations Perspective on Quality Slide 5 of 6 Strategic View of Operations ManagementAmong the recent advances in operations management has been a migration towards a more strategic view.Ferdows and Demeyer linked this strategic view of operations management to quality management by proposing the Sand Cone Model in which quality was identified as the base on which lasting improvement in other competitive dimensions were established.
24Operations Perspective on Quality Slide 6 of 6 An Operations Management Competence Model The Sand Cone ModelFigure 1.4Cost EfficiencySpeedDependabilityQuality
25Strategic Management Perspective on Quality Slide 1 of 3 Nature of the Strategic Management PerspectiveStrategy refers to the planning processes used by an organization to achieve a set of long term goals.The planned course of action must be cohesive and coherent in terms of goals, policies, plans, and sequencing to achieve quality improvement.Initially, quality-related strategic planning was treated as if it were a separate exercise from firm-level strategic planning.However, quality management, to become pervasive in a firm, needed to be included in all of the firm’s business practices, including strategic planning.
26Strategic Management Perspective on Quality Slide 2 of 3 A Generic Strategic Planning ProcessFigure 1.5Firm Missionand GoalsExternalAnalysisInternalAnalysisStrategicOptionsBusiness LevelStrategyCorporate LevelStrategyOperational SubplansOrganizationalDesignOrg. RewardSystemsConflict Politicsand ChangeStrategic AlignmentBetweenStructure and Goals
27Strategic Management Perspective on Quality Slide 3 of 3 Goal of Strategic Quality PlanningThe ultimate goal of strategic quality planning is to aid an organization to achieve sustainable competitive advantage.Research shows that quality is still the major concern of CEOs.
28Marketing Perspective on Quality Slide 1 of 3 Nature of Marketing PerspectiveMarketing efforts are often focused on managing perceptions of quality.Relationship ManagementDirecting attention toward satisfying and delivering value to the customer.Tools for Influencing Customer Perceptions of QualityPrice and advertising are the primary tools for influencing customer perceptions of quality, but are imperfect mechanisms.
29Marketing Perspective on Quality Slide 2 of 3 A Marketing SystemFigure 1.7OrganizationOfferingPaymentIntermediaryOfferingPaymentOfferingPaymentCustomer
30Marketing Perspective on Quality Slide 3 of 3 Focus on ServiceAnother important contribution of the marketing perspective has been the focus on service.Customer service surveys are important tools for assessing the multiple dimensions of quality.
31Financial Perspective on Quality Slide 1 of 4 Nature of the Financial PerspectiveOne of the most commonly asked questions about quality management is “will it pay us financial benefits?”The financial perspective relies more on quantified, measurable, results-oriented thinking.W. Edwards Deming made the first theoretical attempt to link quality improvements to financial results through the “Deming Value Chain.”
32Financial Perspective on Quality Slide 2 of 4 The Deming Value ChainFigure 1.8ImproveQualityCost decrease because of lessrework, fewer mistakes, fewerdelays, snags; better use ofmachine-time and materialsProductivityImprovesCapturetheMarketStay inBusinessProvide Jobsand More Jobs
33Financial Perspective on Quality Slide 3 of 4 Law of Diminishing Marginal ReturnsAccording to this law, there is a point at which investments in quality improvement will become uneconomical.According to the quadratic economic quality level model, higher levels of quality will result in higher expenditures.This view is at odds with the ethic of continual improvement.
34Financial Perspective on Quality Slide 4 of 4 Basic Economic Quality Level ModelFigure 1.9CostTotal Quality Costs = Sum of Losses and GainsCosts of Improving QualityMinimum CostLosses due to poor qualityOptimum Quality LevelQuality
35Human Resources Perspective on Quality Slide 1 of 3 Nature of Human Resources PerspectiveUnderstanding the human resources perspective on quality is essential as it is impossible to implement quality without the commitment and action of employees.Related ConceptsEmployee EmpowermentOrganizational DesignJob Analysis360-degree evaluationTotal Quality Human Resources Management
36Human Resource Perspective on Quality Slide 2 of 3 Employee EmpowermentEmpowering employees involves moving decision making to the lowest level in the organization.Organizational DesignHuman resources managers are involved in many aspects of organizational design, such as the design of reward systems, pay systems, organizational structure, compensation, training mechanisms, and employee grievance arbitration.Job AnalysisInvolves collecting detailed information about a particular job.
37Human Resource Perspective on Quality Slide 3 of 3 360-Degree EvaluationA performance measurement system in which an employee’s peers, supervisors, and subordinates are involved in evaluating the worker’s performance.Total Quality Human Resources Management (TQHRM)TQHRM involves many of the concepts of quality management to provide a more supportive and empowered environment.
38The Three Spheres of Quality Slide 1 of 4 Figure 1.10Quality ManagementQuality AssuranceQuality Control
39The Three Spheres of Quality Slide 2 of 4 Quality ControlIncludes phases of analysis, relation, and generalization.Activities relating to quality control include:Monitoring process capability and stabilityMeasuring process performanceReducing process variabilityOptimizing processes to nominal measuresPerforming acceptance samplingDeveloping and maintaining control charts
40The Three Spheres of Quality Slide 3 of 4 Quality AssuranceRefers to activities associated with guaranteeing the quality of a product or service.Quality assurance activities include tasks such as:Failure mode and effects analysisConcurrent engineeringExperimental designProcess improvementsDesign team formation and managementOff-line experimentationReliability/durability product testing
41The Three Spheres of Quality Slide 4 of 4 Quality ManagementThe management processes that overarch and tie together the control and assurance activities.Quality management activities:Planning for quality improvement.Creating a quality organizational culture.Providing leadership and support.Providing training and retraining.Designing an organizational system that reinforces quality ideals.Providing employee recognition.Facilitating organizational communication.
42Other Perspectives on Quality Slide 1 of 2 The Value-Added Perspective on QualityA customer-based perspective on quality that is utilized by services, manufacturing, and public sector organizations.Involves a subjective assessment of the efficacy of every step of the process for the customer.
43Other Perspectives on Quality Slide 2 of 2 Cultural Perspectives on QualityInternational marketers have long noted that there are differences in tastes and preferences between cultures and nations.It is not so obvious that approaches to quality improvement may differ according to culture.
44Contingency Approach to Quality Contingency TheoryContingency theory presupposes that there is no theory or method for operating a business that can be applied in all situations.As a result, a coherent quality strategy will need to address key environmental variables.Contingency ApproachDefinitions and dimensions of quality applied within an organization will, and should vary.Dimensions of quality will depend on the environment in which a company operates.Provides flexibility to managers in pursuing quality.
45Chapter Summary Recognizing Different Perspectives on Quality What is Quality?Differing Functional Perspectives on QualityThe Three Spheres of QualityOther Perspectives on QualityArriving at a Common Understanding of Quality using a Contingency Perspective of Quality