1 Quality Tools

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A philosophy that involves everyone in an organization in a continual effort to improve quality and achieve customer satisfaction 4

 A systematic approach to improving a process  Overview of the approach  process mapping  analyze the process  redesign the process 5

6 Plan Do Study Act

7 Implement the Improved process Select a process Study/document Seek ways to Improve it Design an Improved process Evaluate Document

 There are a number of tools that can be used for problem solving and process improvement  Tools aid in data collection and interpretation, and provide the basis for decision making 8

 Check sheets  Flowcharts  Scatter diagrams  Histograms  Pareto analysis  Control charts  Cause-and-effect diagrams 9

10 Billing Errors Wrong Account Wrong Amount A/R Errors Wrong Account Wrong Amount Monday

11 Process OK? Process? OK Process Identify value added steps, rework loops, flow loops, etc.

12 Inputs Labor Personnel Capital Machines Money Resources Raw Material Components Energy Facilities Management Arts & Sciences Managerial Talent Technical Expertise

13 Inputs Labor Personnel Capital Machines Money Resources Raw Material Components Energy Facilities Management Arts & Sciences Managerial Talent Technical Expertise Process The firm transforms inputs to outputs (operations, finance, marketing)

14 Inputs Labor Personnel Capital Machines Money Resources Raw Material Components Energy Facilities Management Arts & Sciences Managerial Talent Technical Expertise Process The firm transforms inputs to outputs (operations, finance, marketing) Outputs

15 Inputs Labor Personnel Capital Machines Money Resources Raw Material Components Energy Facilities Management Arts & Sciences Managerial Talent Technical Expertise Process The firm transforms inputs to outputs (operations, finance, marketing) Outputs Clients, customers

 Insurance  Banks  Retail  Golf Course  School Discuss operations for two companies / organizations that you are familiar with. Use one or more of the seven quality tools for one of the companies. 16

17 Variable A Variable B

18 frequency ABCDE

19 80% of the problems may be attributed to 20% of the causes. 80% of the problems may be attributed to 20% of the causes. Smeared print Number of defects Off center Missing label Loose Other

UCL LCL

21 UCL LCL UCL Process not centered and not stable Process centered and stable Additional improvements made to the process

22 Effect MaterialsMethods EquipmentPeople Environment Cause

A. Appropriate Metric – 3.4 million defects per million opportunities B. Robust Methodology – Tools plus implementation methods to make success more likely C. Philosophy – Cost-focused, data-driven 23

1. Critical to Quality: What attributes are most important to the customer? (CTQ, CTC, CTD) 2. Defect: Failing to deliver what the customer wants / expects (DPMO) 3. Variation: The level of unpredictability the customer experiences 24

5. Process Capability: What your process can deliver – consistently 6. Stable Operations: Stable ops are predictable 7. Design for Six Sigma: Designing to meet customer needs and process capability 25

Define Measure Analyze Design Verify Define Measure Analyze Improve Control 26 New Processes Existing Processes

 Project Charter  Stakeholder Analysis  Affinity Diagram  SIPOC  Voice of the Customer  CT Tree  Kano Model  SWOT Analysis  Cause-and-Effect Diagrams  Supplier Segmentation  Project Management 27

 Problem statement  Business case  Goals, milestones, success criteria, & deliverables  Project scope / boundaries  Roles & responsibilities  Stakeholder support / approval needed 28

Potential ImprovementPotential Impact Improve qualityReduce cost, inventory Improve OTDShortages , inventory  Select better suppliersQ, $, LT, reduce inventory Implement rating systemImprove supply efficiency, better suppliers Reduce priceReduce cost 29

 Project Charter  Stakeholder Analysis  Affinity Diagram  SIPOC  Voice of the Customer  CT Tree  Kano Model  SWOT Analysis  Cause-and-Effect Diagrams  Supplier Segmentation  Project Management 30

 Once completed, the Define Phase should answer the following questions: 1)Who is the customer? 2)What matters? 3)What is the scope? 4)What defect am I trying to reduce? 5)What are the improvement targets? 31

 Purpose  To collect current performance of the process identified in the Define phase  This data is used to determine sources of variation and serve as a benchmark to validate improvements 32

 Measurement  Variation  Exists naturally in any process and is the reason Six Sigma projects are undertaken  Data  Data Collection Plan  Measurement System Analysis  Ensures measurement techniques are reproducible and repeatable 33

 What data will be collected?  Why is it needed?  Who is responsible?  How will it be collected?  When will it be collected?  Where will it be collected? 34

 After Data Collection Plan is complete, it needs to be verified before actual data is collected  MSA is performed on a regular basis  MSA ends when a high level of confidence is reached that the data collected accurately depicts the variation in the process 35

 The analyze phase allows the Project Team to target improvement opportunities by taking a closer look at the data. 36

 Capability Analysis - establishing current performance level  Graphical Analysis - a visual indication of performance using graphs  Root Cause Analysis – developing a hypothesis about the causes of variation  Root Cause Verification – verifying that the planned action will generate the desired improvement 37

 Generate Improvement Alternatives  Create a “Should Be” Process Map  Conduct FMEA  Perform Cost/Benefit Analysis  Pilot  Validate Improvement 38

 The Control Phase begins as the project team tries to eliminate errors by “Mistake Proofing” their improvement alternative.  Mistake Proofing attempts to eliminate the opportunities for error. 39

 Mistake Proofing tries to make it impossible for an operation to be performed incorrectly, and/or correct errors before they are passed to the next worker, where they might become a defect. 40

 During the Control Phase the Project team will: 1)Develop a plan to make sure the measurement system will remain relevant over the long term. 2) Establish Control Charts the process owner will use to manage the process. 3) Create a Reaction Plan to address situations that might cause the process to move out of control. 41

 The Control Phase ends when: 1) Standard Operating Procedures have been updated. 2) Process Operators, the people who do the job, have been trained for the new process.  Once completed, the Control Phase should sustain the gains the project made while implementing ongoing process controls. 42

 When is a project complete? 1) When other Black Belts can see the ongoing controls work 2) When the customer sees the results 3) When the business sees the money. 43

People or Groups Level of Commitment BuyMfgEng Enthusiastic Support Help it work Compliant Hesitant X Indifferent Uncooperative X Opposed Hostile X 44

SuppliersInputsProcessesOutputsCustomers Ops Mgt Supplier Perf. Supplier Evaluation SurveyOps Mgt Buyers ComplaintRating system Buyers Engrg. Tech ReqtsImproved Supplier Perform. Engineering Mfg. Rating system Commit. to suppliers Mfg. Suppliers Supplier Complaint Suppliers 45

PositiveNegative Internal StrengthsWeaknesses External OpportunitiesThreats 46

47 Baldrige Award

 Began in 1987  Recognizes achievements of excellent organizations and provide examples to others  may give two awards in each category  manufacturing  small business  service  health care  education 48

 Establishes criteria for evaluating quality efforts  Provides guidance for other American companies 49

1.0 Leadership Strategic Planning Customer and Market Focus Measurement, Analysis, & Knowledge Management Workforce Focus Process Management Results450 50

 Excellence Award  Achievement Award  Commitment Award  Interest Award 51

 Set of international standards on quality management and quality assurance, critical to international business  ISO 9000 series standards, briefly, require firms to document their quality-control systems at every step (incoming raw materials, product design, in-process monitoring and so forth) so that they’ll be able to identify those areas that are causing quality problems and correct them 52