Introduction to Quality Chapter 1 Introduction to Quality Slide 1.1 1999 South-Western College Publishing 1

Importance of Quality “The first job we have is to turn out quality merchandise that consumers will buy and keep on buying. If we produce it efficiently and economically, we will earn a profit, in which you will share.” - William Cooper Procter Slide 1.2 2

Quality Assurance is any action directed toward providing customers with goods and services of appropriate quality. Slide 1.3 3

History of Quality Assurance (1 of 2) Skilled craftsmanship during Middle Ages Industrial Revolution: rise of inspection and separate quality departments Statistical methods at Bell System Quality control during World War II Quality management in Japan Slide 1.4 4

History of Quality Assurance (2 of 2) Quality awareness in U.S. manufacturing industry during 1980s Malcolm Baldrige National Quality Award (1987) Quality in service industries, government, health care, and education Current challenge: keep progress in quality management alive Slide 1.5 5

Definitions of Quality Transcendent definition: excellence Product-based definition: quantities of product attributes User-based definition: fitness for intended use Value-based definition: quality vs. price Manufacturing-based definition: conformance to specifications Slide 1.6 6

Key Dimensions of Quality Performance Features Reliability Conformance Durability Serviceability Aesthetics Perceived quality Slide 1.7 7

Quality Perspectives transcendent & product-based user-based Customer Distribution products and services needs transcendent & product-based user-based manufacturing- based value-based Marketing Design Manufacturing Information flow Product flow Slide 1.8 8

Customer-Driven Quality “Meeting or exceeding customer expectations” Consumers External customers Internal customers Slide 1.9 9

Quality in Production Systems Production is the process of converting resources into goods and services Production systems consists of: Inputs Outputs Processes Slide 1.10 10

Deming’s View of a Production System Suppliers of materials and equipment Receipt and test of materials Design and Redesign Consumer research A B C D Production, assembly inspection Tests of processes, machines, methods Distribution Consumers INPUTS PROCESSES OUTPUTS Slide 1.11 11

Three Levels of Quality Organizational level: meeting external customer requirements Process level: linking external and internal customer requirements Performer/job level: meeting internal customer requirements Slide 1.12 12

GAO TQM Model Product and service quality Customer satisfaction Leadership for continuous improvement Quality systems and employee involvement Competitiveness Organization benefits Reliability On-time delivery Error/defects Overall satisfaction Customer retention Complaints Costs Cycle time Turnover Satisfaction Safety & health Productivity Market share Profits Slide 1.13 13

Quality as Important Source of Competitive Advantage Driven by customer wants and needs Makes significant contribution to business success Matches organization’s unique resources with opportunities Is durable and lasting Provides basis for further improvement Provides direction and motivation Slide 1.14 14

Quality and Profitability Improved quality of design Higher perceived value Increased market share Higher prices Increased revenues of conformance Lower manufacturing and service costs Higher profitability Slide 1.15 15

Quality and Personal Values Personal initiative has a positive impact on business success Quality begins with personal attitudes Quality-focused individuals often exceed customer expectations Attitudes can be changed through awareness and effort (e.g., personal quality checklists) Slide 1.16 16