5.4 Quality Assurance Chapter 33

What is a quality product? A good or service that meets customers’ expectations and is “fit for purpose”. A good or service that meets customers’ expectations and is “fit for purpose”. Quality is relative Quality is relative Products don’t have to be expensive to be of good quality. (shampoo) Products don’t have to be expensive to be of good quality. (shampoo) Products may have to perform perfectly to be considered good quality (airplanes) Products may have to perform perfectly to be considered good quality (airplanes) What other products can you think of? What other products can you think of?

Quality Standards The expectations of customers expressed in terms of the minimum acceptable production or service standards. The expectations of customers expressed in terms of the minimum acceptable production or service standards. What is YOUR quality standard for PIZZA? What is YOUR quality standard for PIZZA? What is YOUR quality standard for CLOTHING? What is YOUR quality standard for CLOTHING? What is YOUR quality standard for PENCILS? What is YOUR quality standard for PENCILS?

Advantages of producing a quality product Easier to create customer loyalty Easier to create customer loyalty Saves on costs associated with customer complaints (replacement & compensation) Saves on costs associated with customer complaints (replacement & compensation) Defective products and loss of customer goodwill Defective products and loss of customer goodwill Longer life cycles Longer life cycles Less advertising as the quality image is reinforced by the performance of its products Less advertising as the quality image is reinforced by the performance of its products A higher price – premium price – may be charged which can add to profits A higher price – premium price – may be charged which can add to profits

Quality Control Quality control is based upon inspecting the product or a sampling of products. Quality control is based upon inspecting the product or a sampling of products. Traditional approach to achieving quality Traditional approach to achieving quality Based upon inspection and checking Based upon inspection and checkingProduction MP3 player is inspected and checked at the end of the production line to see if the battery will charge. MP3 player is inspected and checked at the end of the production line to see if the battery will charge.Service A on-line support person will have customer phone calls monitored or recorded. A on-line support person will have customer phone calls monitored or recorded.

Quality Control Techniques 1. Prevention Most effective Quality should be designed into the product. 1. Prevention Most effective Quality should be designed into the product. 2. Inspection Traditionally the most important phase 2. Inspection Traditionally the most important phase Costly and the need for inspection can be reduced by “zero-defect” manufacturing. 3. Correction and Improvement Improves future quality effective Not just fixing faulty products, but fixing the what caused the problem in the first place. This will improve future quality. 3. Correction and Improvement Improves future quality effective Not just fixing faulty products, but fixing the what caused the problem in the first place. This will improve future quality.

Inspecting Emphasis is placed on checking for quality at the end of the production line. Emphasis is placed on checking for quality at the end of the production line. Products can be inspected periodically during production. Products can be inspected periodically during production. PROBLEMS: PROBLEMS: Expensive Expensive Qualified people need to be used Qualified people need to be used Product may be destroyed Product may be destroyed May need to sample instead – which means all products aren’t checked for quality May need to sample instead – which means all products aren’t checked for quality

Inspecting Issues with inspecting Issues with inspecting Quality-control inspectors check the work others Quality-control inspectors check the work others Looking for problems; creates negative culture for workers Looking for problems; creates negative culture for workers Inspectors are “successful” when they find “problems” – which causes issues for workers Inspectors are “successful” when they find “problems” – which causes issues for workers Inspecting is tedious work and inspectors may become demotivated Inspecting is tedious work and inspectors may become demotivated If checking is done at “points” in the production process, it can be hard to locate where the quality error occurred. If checking is done at “points” in the production process, it can be hard to locate where the quality error occurred. Workers will not see quality as their responsibility – but that of the quality control inspectors Workers will not see quality as their responsibility – but that of the quality control inspectors

Quality Assurance - A departure from Quality Inspecting Puts emphasis on prevention of poor quality by design during manufacturing rather than inspecting after it is produced Puts emphasis on prevention of poor quality by design during manufacturing rather than inspecting after it is produced Stress that workers “Get it right the first time” so errors are unlikely to happen Stress that workers “Get it right the first time” so errors are unlikely to happen Establish the quality standard for each stage of the production process Establish the quality standard for each stage of the production process Check components, materials, & services when they are delivered – NOT at the end of production or time of use Check components, materials, & services when they are delivered – NOT at the end of production or time of use

Quality Assurance Quality Assurance is considered in all areas: Quality Assurance is considered in all areas: Product design Product design Will product meet consumer expectations Will product meet consumer expectations Quality of inputs (suppliers and bought-in products) Quality of inputs (suppliers and bought-in products) Suppliers will have to accept strict quality standards Suppliers will have to accept strict quality standards Production quality Production quality Workers ensure quality production occurs Workers ensure quality production occurs Customer service Customer service Continued customer satisfaction during and after sales Continued customer satisfaction during and after sales

Advantages of Quality Assurance EVERYONE is responsible for quality (a type of job enrichment) EVERYONE is responsible for quality (a type of job enrichment) Self-checking increases motivation Self-checking increases motivation Quality problems can be “traced” to origin Quality problems can be “traced” to origin Reduces expensive final inspections, corrections, and faulty products Reduces expensive final inspections, corrections, and faulty products

ISO 9000 International Standards Organization International Standards Organization ISO actually means “equal” in Greek ISO actually means “equal” in Greek ISO is an internationally recognized certificate that acknowledges the existence of a quality procedure that meets certain conditions. ISO is an internationally recognized certificate that acknowledges the existence of a quality procedure that meets certain conditions.

ISO 9000 In order to be accredited, you must In order to be accredited, you must Staff training on quality and appraisal methods Staff training on quality and appraisal methods Methods in place to check suppliers quality Methods in place to check suppliers quality Quality standards in ALL areas of your business Quality standards in ALL areas of your business Procedures for dealing with defective products and quality failures Procedures for dealing with defective products and quality failures After-sales service After-sales service ISO companies are internally audited AND externally audited. ISO companies are internally audited AND externally audited. Can be expensive Can be expensive Doesn’t guarantee a quality product Doesn’t guarantee a quality product

QS 9000 US counter-part to ISO 9000 US counter-part to ISO 9000 Established by US automobile manufacturers in 1994 and adopted for use by the heavy truck manufacturing industry. Established by US automobile manufacturers in 1994 and adopted for use by the heavy truck manufacturing industry. It was replaced with ISO/TS because of the international nature of car manufacturers and suppliers. It was replaced with ISO/TS because of the international nature of car manufacturers and suppliers.

Total Quality Management (TQM) An approach to quality that involves all employees in the quality process. An approach to quality that involves all employees in the quality process. It aims to reduce waste and cost of rejected low-quality products. It aims to reduce waste and cost of rejected low-quality products. LEAN PRODUCTION: Producing goods and services with the minimum of wasted resources while maintaining high quality. LEAN PRODUCTION: Producing goods and services with the minimum of wasted resources while maintaining high quality.

TQM is a PHILOSPHY All employees are responsible for quality from the assembly worker to the delivery driver. All employees are responsible for quality from the assembly worker to the delivery driver. All employees are empowered to check and verify quality. All employees are empowered to check and verify quality. Provides high level of job enrichment. Provides high level of job enrichment. Encourages staff to “get it right the first time” Encourages staff to “get it right the first time” Achievement of “zero defects” is a goal Achievement of “zero defects” is a goal If quality is improved, than costs fall and demand for products rise If quality is improved, than costs fall and demand for products rise REQUIRES commitment from management to give employees flexibility to make quality decisions REQUIRES commitment from management to give employees flexibility to make quality decisions

TQM Internal customers – people within the organization who depend upon quality work completed by others. Internal customers – people within the organization who depend upon quality work completed by others. Zero Defects – The aim of achieving perfect products EVERY time. Zero Defects – The aim of achieving perfect products EVERY time.

Kaizen Japanese term meaning “continuous improvement” Japanese term meaning “continuous improvement” Employees may know more about factory improvements than managers. Employees may know more about factory improvements than managers. A series of small improvements can be more beneficial that “one-off” improvements. A series of small improvements can be more beneficial that “one-off” improvements. HL

Implementing Kaizen Management must recognize experience of workers Management must recognize experience of workers Team working from the workers; team meetings to identify problems and discuss improvement strategies Team working from the workers; team meetings to identify problems and discuss improvement strategies Employee empowerment to make changes Employee empowerment to make changes All staff is involved All staff is involved HL

Limitations of Kaizen Some changes are not small and cannot be introduced gradually Some changes are not small and cannot be introduced gradually Resistance from senior management Resistance from senior management Staff training and lost output due to meetings Staff training and lost output due to meetings Improvements tend to be made early; later changes tend to be less significant Improvements tend to be made early; later changes tend to be less significant HL

Benchmarking Comparing the performance – including quality – of a business with performance standards throughout the industry Comparing the performance – including quality – of a business with performance standards throughout the industry “How do I compare with others?” “How do I compare with others?” HL

Stages of Benchmarking 1. Identify what areas are to be benchmarked (ask and survey customers) 1. Identify what areas are to be benchmarked (ask and survey customers) 2. Measure these areas (quality records, delivery records, customer complaints) 2. Measure these areas (quality records, delivery records, customer complaints) 3. Identify firms in the industry that are “the best” 3. Identify firms in the industry that are “the best” 4. Use comparative data to find your weaknesses 4. Use comparative data to find your weaknesses 5. Set standards for improvement 5. Set standards for improvement 6. Change your processes to achieve your standards 6. Change your processes to achieve your standards 7. Re-measurement: Check to see if you are reaching your new higher standards. 7. Re-measurement: Check to see if you are reaching your new higher standards. HL

Quality Summary Quality is not an OPTION Quality is not an OPTION Quality is an issue for ALL firms Quality is an issue for ALL firms Satisfying customers with quality products/services has clear marketing advantages Satisfying customers with quality products/services has clear marketing advantages Involving staff can motivate the workforce Involving staff can motivate the workforce HL