1. Basic Concepts of Quality Philosophy
Chapter 1

2. Objectives What is Quality? History and Gurus Global Competiveness
Customer Satisfaction, Retention, and Loyalty

3. Quality Management
Quality has been defined in a number of ways. When viewed from a consumer’s perspective, it means meeting or exceeding customer expectations.
Total quality is an approach to doing business that attempts to maximize an organization’s competitiveness through the continual improvement of the quality of its products, services, people, processes, and environments.

4. 1800’s Standardization and Quality Control
Quality Timeline
1800’s Standardization and Quality Control
Zero Quality Control; quality trilogy; TQM fishbone diagram
Statistical analysis
Management by quality
Quality control
1990’s
Value chain
Continuous improvement
1800’s Eli Whitney with interchangeabile parts and work planning
Shewhart
Deming and Philip Crosby
1999-Now
Lean Quality Improvements

5. A Change in thinking, culture and doing business.
Key characteristics
The rationale can be found in the need to:
compete in the global marketplace.
Higher Costs
More Knowledgeable and demanding quality customers
Countries that are competing successfully in the global marketplace are seeing their quality of living improve. Those that cannot are seeing theirs decline.
Key Characteristics: Phase 2: Strategically based, Phase 1:Customer focus, Phase 5: obsession with quality, scientific approach (data-Data-Data), Phase 3: Initial training, pilot projects, Phase 2:long-term commitment, Phase 4: Expand training and teamwork, employee involvement and empowerment, Phase 5:continual process improvement, education and training

6. Using the Road Map Maximizes the Probability of Success and Avoids the “Flavor of the Month” Syndrome
Phase 5
Integrate, Audit,
Measure, Assess,
Review, Inspect,
Focus
Phase 4
Sustain
Expand Training
across the organization
Transition Training
from Juran to
Client
Phase 3
Expand
Initial Training
Pilot Projects
Phase 2
Launch
Up Front Planning
Establish
Infrastructure
Executive
Onboard
Prepare
Phase 1
Yes to
Deployment
Decide
Organization/Partner
Time

7. Breakthrough Thinking VARIOUS NEEDS…
Radical Change
Incremental Change
Carry-over Modules
Best-in-Class
Fix as Fail
Self-Inspection
"As-is"
Minor modifications 5S
Root Causes are not always identified
Quality Improvement
Lean Manufacturing
Process flow revisions
Check
Inspect
Quality Control
Revise
Customer Focused
Re-Design
Creative thinking
Innovation
Six Sigma
Benchmarking
New technology

8. Quality Gurus W. Edward Deming Joseph M. Juran Philip Crosby Taguchi
Deming – 14 points knowledge (FIND THOSE) and system approach and statistical approach
Juran – 3 focus of quality processes, quality planning, quality control PLAN-DO-CHECK-ACT
Crosby – believes in zero defects and conformance to requirements/standards

9. One: The Total Quality Approach to Quality Management (Continued)
W. Edward Deming is best known for his Fourteen Points, the Deming Cycle, and the Seven Deadly Diseases.
Joseph M. Juran is best known for Juran’s Three Basic Steps to Progress, Juran’s Ten Steps to Quality Improvement, the Pareto Principle, and the Juran Trilogy.
David Goetsch Quality Management, 5e
Copyright ©2006 by Pearson Education, Inc. Upper Saddle River, New Jersey All rights reserved.

10. Performance at World-class levels
competitive analysis
production and supply chain management
Customization
electronic commerce, and
compensation systems.
The costs of poor quality include the following: waste, rejects, retesting, rework, customer returns, inspection, recalls, excessive overtime, pricing errors, billing errors, excessive turnover, premium freight costs, development cost of the failed product, field service costs, overdue receivables, handling complaints, expediting, system costs, planning delays, late paperwork, lack of follow-up, excess inventory, customer allowances, and unused capacity.

11. Customer Satisfaction, Retention, and Loyalty
Understanding Who Is a Customer
An external customer is the one referred to in the traditional definition. An internal customer is any employee whose work depends on that of employees
Communicating with Customers
Using Customer Feedback to Make Design Improvements
David Goetsch Quality Management, 5e
Copyright ©2006 by Pearson Education, Inc. Upper Saddle River, New Jersey All rights reserved.

12. Customer Satisfaction, Retention, and Loyalty (Continued)
Understanding Customer-Defined Quality
Customer Satisfaction Process
Customer-Defined Value
Customer Value Analysis
Customer satisfaction is achieved by producing high-quality products that meet or exceed expectations. It must be renewed with each purchase. The key to establishing a customer focus is to put employees in touch with customers so that customer needs are known and understood.
David Goetsch Quality Management, 5e
Copyright ©2006 by Pearson Education, Inc. Upper Saddle River, New Jersey All rights reserved.

13. Customer Satisfaction, Retention, and Loyalty (Continued)
Customer Retention
Scholtes’ six-step strategy for identifying customer needs: speculate about results, develop an information-gathering plan, gather information, analyze the results, check the validity of conclusions, and take action.
Customer needs are not static.
constant contact is essential
this contact should be in person or by telephone. Written surveys can be used, but they will not produce the level of feedback that personal contact can generate.

14. Customer Satisfaction, Retention, and Loyalty (Continued)
Recognizing the Customer-Driven Organization
Value Perception and Customer Loyalty
Measurement –
Quality function deployment (QFD) - makes customer feedback a normal part of the product development process, thereby improving customer satisfaction.
Many customers who defect are satisfied. Organizations should, in addition, measure customer retention.
David Goetsch Quality Management, 5e
Copyright ©2006 by Pearson Education, Inc. Upper Saddle River, New Jersey All rights reserved.

15. Customer Satisfaction, Retention, and Loyalty (Continued)
The customer loyalty model consists of four components: 1) business performance, 2) global perceptions, 3) loyalty behaviors, and 4) financial outcomes.
Organizations should never assume a positive correlation between customer loyalty and profitability, nor should they assume that a customer who is initially profitable will always be profitable.
David Goetsch Quality Management, 5e
Copyright ©2006 by Pearson Education, Inc. Upper Saddle River, New Jersey All rights reserved.

16. Customer Satisfaction, Retention, and Loyalty (Continued)
An innovative approach to product development - turning customers into innovation partner. Customer is given a technological tool kit for designing his or her own products This approach is implemented by:
develop a tool kit for customers that is easy to use
increase the flexibility of your own production processes
carefully select the first customers to use your took kit
continually improve your tool kit
adapt your business practices to suit the innovation partnership approach.
David Goetsch Quality Management, 5e
Copyright ©2006 by Pearson Education, Inc. Upper Saddle River, New Jersey All rights reserved.

17. Chapter 1
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