BUAD306 Chapter 9 – Management of Quality Chapter 10 – Quality Control (not in text) READ THIS CHAPTER!

Quality Defined By YOU Examples of high quality products and services? Examples of low quality products and services? What do you remember more?

Quality Defined by Business The ability of a product or service to consistently meet or exceed customer expectations

Dimensions of Quality Performance – basic operating characteristics Aesthetics – how a product looks, feels, etc. Special features – “extras” Conformance – to specifications Reliability – consistency of performance Durability – how long it lasts Perceived Quality – customer’s view of quality Serviceability - service after sale/repairs Safety – risk of harm/injury

Quality Terms Ease of Use – how easy it is for the customer to use the product/service Service after Use – how well the company “steps up” Quality of Design – designing quality characteristics into a product or service Quality of Conformance – making sure the product is produced according to the design/intent of designers

Quality Considerations For Service Industries Tangibles – appearances (staff, facility, etc.) Convenience – ease of availability/accessibility Reliability – perform consistently & accurately Responsiveness – how well company reacts to unusual circumstances Timeliness – speed of service delivery/waiting time Assurance – the knowledge level of the staff Courtesy – how well customer is treated

Consequences of Poor Quality Loss of business Liability - due to damages or injury Productivity – defective products can slow down a production process Costs Diminished Reputation

Costs of Quality Appraisal Costs – costs of measuring, testing and analyzing Prevention Costs – costs incurred during production design Failure Costs – difference between what it actually costs to produce/deliver & what it would cost if there were no failures Internal Failure Costs (before)– rework, downtime External Failure Costs (after)– complaints, returns

Quality Responsibilities Who is responsible for quality in the organization? Why is it important to face quality issues sooner than later?

Ensuring Continual Quality Design quality into the process Instill a quality mentality Continually seek new ideas and improvements How do you do this systematically???

Total Quality Management A philosophy that involves everyone in an organization in a continual effort to improve quality and achieve customer satisfaction.

Total Quality Management 1.Customer defined quality 2.Successful product design 3.Utilize processes that ensure quality 4.Continuous improvement - track results & improve on them 5.Encourage suppliers & distributors to embrace TQM 6.All employees responsible for quality – requires training 7.Utilize competitive benchmarking 8.Shared problem solving – team oriented 9.Top management leadership Read Text

Six Sigma – as defined by GE “…if you can measure how many "defects" you have in a process, you can systematically figure out how to eliminate them and get as close to "zero defects" as possible. To achieve Six Sigma Quality, a process must produce no more than 3.4 defects per million opportunities. An "opportunity" is defined as a chance for nonconformance, or not meeting the required specifications. This means we need to be nearly flawless in executing our key processes. IMPT: Read Text

Six Sigma Concepts - DMAIC Define – process improvement goals Measure – baseline data Analyze – to verify cause Improve – based on analysis Control – transition into production & monitor continuously IMPT: Read Text

Example: Trabant Is Trabant an example of efficiency? Are there issues at Trabant? What solutions do you have?

Problem Solving & Quality Variety of Techniques – all generally following the same “steps:” Define problem Develop measures/standards Analyze the situation Generate solutions Implement solution Monitor IMPT: Read Text

Basic Quality Tools Check sheets Flowcharts Scatter diagrams Histograms Pareto analysis Control charts Cause-and-effect diagrams Run Chart IMPT: Read Text

Generating New Ideas Brainstorming Interviewing Benchmarking 5W2H What, Why, Where, When, Who, How, How Much IMPT: Read Text

Benchmarking Steps Analysis using quality tools Identify a critical process that needs improvement Identify an organization that excels in the process Study their benchmark activity Analyze data (compare/contrast) Improve process IMPT: Read Text

Chapter 10 Quality Control

Quality Scenarios Toner Cartridges Subway Subs Taco Bell Tacos

Quality Control A process that measures output relative to a standard and acts when outputs don’t meet the standard

Phases of Quality Assurance Acceptance sampling Process control Continuous improvement Inspection before/after production Corrective action during production Quality built into the process The least progressive The most progressive

Inspection How Much/How Often  Why?? Where/When Centralized vs. On-site InputsTransformationOutputs Acceptance sampling Process control Acceptance sampling

Inspection Points Production Inputs Finished products Before a costly operation Before an irreversible process Before a covering process Services Restaurants – appearance, waiting time, food quality, accuracy Retail – inventory, pricing, appearance, waiting time

Process Control A statistical procedure using control charts to see if any part of the production process is not functioning properly and could cause poor quality.

Process Control Steps Define Measure Compare to standard Evaluate Take corrective action Evaluate corrective action

Variations and Control Assignable Variation - A variation whose source can be identified Examples: fatigue, equipment adjustments, carelessness, interruptions Random Variation - Natural variations in the output of process Examples: Countless minor factors

Data Evaluated Attribute Data (P & C Charts) Product characteristic evaluated with a discrete choice: Good/bad, yes/no Variable Data (Control Charts) Product characteristic that can be measured on a continuous scale: Length, size, weight, height, time, velocity

Control Charts A time-ordered plot of sample statistics, used to distinguish between random and nonrandom variability Compared against control limits Upper control limits Lower control limits

Process Control Charts UCL LCL Sample number Mean Out of control Normal variation due to chance Abnormal variation due to assignable sources

Process is In Control When… No sample points are outside limits Most points near process average Equal number of points above & below centerline Points appear randomly distributed