1. OPSM 301 Operations Management
Koç University
OPSM 301 Operations Management
Class 16:
Quality
Zeynep Aksin

2. Process management overview
Strategic positioning-establish product capabilities
Determine appropriate process capabilities: time, quality, cost, flexibility
Process design, appropriate selection of resources
Process documentation: flowchart
Analyze at macro level
Where is the bottleneck?
Is capacity enough?
How is time performance?
Where do quality problems occur?
Analyze at micro level
Scheduling: focus on the bottleneck
Set-up times, lotsize
Reduce variability

3. Framework for Process Flow Management
Competitive? No
Flow Chart Process
Identify Bottlenecks
Maximal Flow Rate
Identify Critical Path
Minimal Flow Time
Demand
Pattern
Macro Average
Performance
Process
Re-Design
Micro Variability
Demand &
Supply Mgt
Continuous
Improvement
mean
variability
Yes

4. What does the term quality mean?
Quality Management
What does the term quality mean?
Product-based definition
Manufacturing based definition
User-based definition

5. Product-Based Definition
According to this view, differences in quality reflect differences in the quantity of some ingredient or attribute possessed by a product (Example: Fine rugs have a large number of knots per square centimeter)
This approach seems appropriate only if the attributes in question are considered preferable by virtually all buyers

6. Manufacturing-Based Definition
This approach identifies quality as “conformance to requirements”
This approach's primary focus is internal, however, the consumers’ interest in quality is implicitly recognized
According to the manufacturing-based approach, improvements in quality lead to lower costs

7. User-Based Definition
This approach starts from the opposite premise that quality “lies in the eyes of the beholder”
The goods that best satisfy consumers' preferences are those that they regard as having the highest quality

8. Variability = Actual - Expected
Customer Needs - Product Design
Product Design - Process Capability
Process Capability - Process Performance
Process Performance - Product Performance
Product Performance - Customer Perception

9. Ways in Which Quality Can Improve Profitability
Sales Gains
Improved response
Higher prices
Improved reputation
Improved Quality
Increased Profits
Reduced Costs
Increased productivity
Lower rework and scrap costs
Lower warranty costs

10. Quality Costs Cost of Control (Quality, Conformance)
Prevention costs: reducing the potential for defects
Appraisal costs: evaluating products
Cost of Failure of Control (Unquality, non-conformance)
Internal failure costs:of producing defective parts or service
External failure costs: occur after delivery

11. Early Defect Detection Saves
Stage: At Source Next Process End of Line Final Inspection End User
Cost:
Impact: • Little • Minor • Rework • Much rework • Warranty
delay • Reschedule • Delivery delay • Complaints
• Inspect more • Reputation
• Market share
Prevention Saves Even More!

12. Tradeoffs in Process Control
Degree of Control
Cost
Cost of Control
Cost of
Non-Conformance

13. International Quality Standards
ISO 9000 series
Common quality standards for products sold in Europe (even if made in U.S.)
2000 update places greater emphasis on leadership and customer satisfaction
ISO series
Environmental management
Auditing
Performance evaluation
Labeling
Life cycle assessment

14. TQM: Continuous Process Improvement
Measurement
External and Internal
Analysis
Analyze Variation
Control
Adjust Process
Improvement
Reduce Variation
Innovation
Redesign Product/Process D A C P
Improve
Innovate D A C P
Improve
Control

15. Analytical Tools for Continuous Improvement
Process Analysis
Pareto Charts
Histograms
Scatter Diagrams
Fish-Bone Charts
Control Charts

16. Seven Tools for TQM

17. Check Sheet Type of Defect Number of Defective Flow Units Cost
Response Time
Customization
Service Quality
Garage Quality

18. Pareto Analysis
The purpose of Pareto Analysis is to identify and highlight major symptoms of major quality problems
It is based on the premise that usually a small number of faults cause the majority of malfunctions (to separate the vital few and trivial many)

19. Developing Pareto Analysis
Define classification of defects to be monitored
Define the period of time over which the assessment will be made
Total the frequency of occurrence of each class of defects over the period
Plot the histogram and cumulative distribution of the classes in descending order of the frequency occurrence
Identify the classes that constitute the majority of defect occurrences

20. “80 percent of the problems are due to 20 percent of the causes”
Pareto Analysis
Frequency
Percentage
-100%
-50%
-0%
A B C D E F
Pareto Law (80/20 Rule):
“80 percent of the problems are due to 20 percent of the causes”

21. Fish-Bone Diagram
Also known as cause-and-effect diagram, or Ishikawa diagram
Pareto analysis is used to identify key problems or symptoms,
Fish-Bone diagram is used to sort causes of the problems
Brain storming sessions of groups of workers needed
It is a very valuable educational tool

22. Used to find problem sources/solutions Other names Steps
Fish-Bone Diagram
Used to find problem sources/solutions
Other names
Fish-bone diagram, Ishikawa diagram
Steps
Identify problem to correct
Draw main causes for problem as ‘bones’
Ask ‘What could have caused problems in these areas?’ Repeat for each sub-area.
This slide introduces the Cause and Effect Diagram. The next several slide show the development of a simple example.
If time is available, it would be helpful to ask students to develop their own examples.

23. Cause-and-Effect Diagrams
Material
(ball)
Method
(shooting process)
Size of ball
Lopsidedness
Grain/Feel (grip)
Air pressure
Follow-through
Hand position
Aiming point
Bend knees
Balance
Missed free-throws
Training
Conditioning
Motivation
Concentration
Consistency
Manpower
(shooter)
Rim alignment
Rim size
Backboard stability
Rim height
Machine
(hoop &
backboard)
Figure 6.7

24. Weight data for 20 days-Table 1
Time 1 2 3 4 5 6 7 8 9 10
9:00 81 82 80 74 75 83 86 88
11:00 73 87 79 84
13:00 85 76 91 89
15:00 90 78 77
17:00
Time 11 12 13 14 15 16 17 18 19 20
9:00 86 88 72 84 76 74 85 82 89
11:00 83 79 80
13:00 81 78 90
15:00 77 92
17:00 87

25. Histogram 2 4 6 8 1 7 9
Weight (kg)
Frequency

26. Design for Processing Simplify Standardize Mistake-proof
Fewer parts, steps
Modular design
Standardize
Less variety
Standard, proven parts, and procedures
Mistake-proof
Clear specs
Ease of assembly, disassembly, servicing

27. The Shingo System: Fail-Safe Design
Shingo’s argument:
Defects arise when people make errors
Defects can be prevented by providing employees with feedback on errors and putting controls in the process
Poka-Yoke includes:
Checklists
Special tooling that prevents employees from making errors
(Poka-Yoke: Japanese slang for “avoiding inadvertent errors” ) 21

28. Which dial turns on the burner?
Stove A
Stove B

29. Announcement
Group Case Assignment 2
See Web page to download a copy
Due in one week