1. Chapter 7 Quality ©McGraw-Hill Education. All rights reserved.

2. Key Questions Addressed in Chapter 7 How do we assure quality? How do we know that what we ordered meets expectations?

3. Market Niches for Quality ©McGraw-Hill Education. All rights reserved. 3 Quality Better than Competitors Lower than Competitors Same as Competitors

4. The Transformation and Value-Added Chain ©McGraw-Hill Education. All rights reserved. 4 CustomerConverterSupplier CustomerSupplierConverter CustomerSupplier

5. What is Quality? Often used to describe: – Function – Suitability – Reliability – Conformance with specifications – Satisfaction with actual performance – Best buy

6. Eight Dimensions of Quality 1.Performance: The primary function of the product or service 2.Features: The bells and whistles. 3.Reliability: The probability of failure within a specified time period. 4.Durability: The life expectancy. 5.Conformance: The meeting of specifications. 6.Serviceability: The maintainability and ease of fixing. 7.Aesthetics: The look, smell, feel, and sound. 8.Perceived quality: The image in the eyes of the customer. ©McGraw-Hill Education. All rights reserved. 6

7. The Traditional View of Quality-Cost Trade-off ©McGraw-Hill Education. All rights reserved. 7

8. The Current View of the Quality-Cost Trade-off ©McGraw-Hill Education. All rights reserved. 8

9. Five Major Cost of Quality Categories Prevention costs Appraisal costs Internal failure costs External failure costs Morale costs ©McGraw-Hill Education. All rights reserved. 9