1. Customer and Market Focus Information and Analysis
Malcolm Baldrige National Quality Award Established 1987, Revised in 1999
Leadership
Strategic Planning
Customer and Market Focus
Information and Analysis
Human Resource Focus
Process Management
Business Results

2. Components of Quality
Design quality: Inherent value of the product in the marketplace
Dimensions include: Performance, Features, Reliability, Durability, Serviceability, Response, Aesthetics, and Reputation.
Conformance quality: Degree to which the product or service design specifications are met
Quality at the source: person who does the work takes responsibility for making sure the output meets specifications

3. Internal Failure Costs
Costs of Quality
External Failure
Costs
Appraisal Costs
Prevention Costs
Internal Failure Costs
Costs of
Quality

4. Six Sigma Quality
A philosophy and set of methods companies use to eliminate defects in their products and processes
Seeks to reduce variation in the processes that lead to product defects
The name, “six sigma” refers to the variation that exists within plus or minus six standard deviations of the process outputs

5. Six Sigma Quality: DMAIC Cycle (Cont.)
1. Define (D)
Customers and their priorities
2. Measure (M)
Process and its performance
3. Analyze (A)
Causes of defects
4. Improve (I)
Remove causes of defects
5. Control (C)
Maintain quality

6. Basic Causes of Variation
Assignable causes are factors that can be clearly identified and possibly managed.
Common causes are inherent to the production process. In order to reduce variation due to common causes, the process must be changed.
Key: Determining which is which!

7. Types of Processes Design ETO Customer Order Source MTS Customer Order
Manufacture
Fabricate
Assemble
MTO
Customer
Order
ATO
Customer
Order
Distribute
Time

8. Process Performance Metrics
Throughput time = Average time for a unit to move through the entire system
Cycle time = Average time between completion of units
Throughput rate = Cycle time

9. Process Performance Metrics (Continued)
Little’s Law:
Throughput time = Work-in-process
Throughput rate

10. Process-Oriented Layout
Design places departments with large flows of material or people together
Dept. areas have similar processes
e.g., All x-ray machines in same area
Used with process-focused processes
Examples
Hospitals
Machine shops
© 1995 Corel Corp.

11. Process-Oriented Layout Floor Plan
Office
Table Saws
© 1995 Corel Corp.
Drill Presses
Tool Room
© 1995 Corel Corp.

12. Product-Oriented Layout
Facility organized around product
Design minimizes line imbalance
Delay between work stations
Types: Fabrication line; assembly line
Examples
Auto assembly line
Brewery
Paper mfg.
© T/Maker Co.

13. Cellular Layout - Group Technology (Work Cells)
Special case of process-oriented layout
Consists of different machines brought together to make a product
Group Technology Benefits:
Better human relations
Improved operator expertise
Less in-process inventory and material handling
Faster production setup

14. Work Cell Floor Plan
Saws
Drills
Office
Work Cell
Tool Room

15. Example of Line Balancing:
Step 5: Make assignments I
4.2
A,C
A,C A A C B D E F G H 2
3.25
1.2 .5 1
1.4
1.1
2.2
B,C B B - .2 .2
G,C II
4.2
G,C
G,C C -
.95
.95
D,G
III
4.2
D,G
D,G D
3.0
G,E
G,E E
2.5
G,F
G,F F
Task
Followers
Time (Mins) A 6 2 C 4
3.25 D 3
1.2 B E
0.5 F 1
1.1 G H
1.4
1.4 G G G - .4 .4 H IV
4.2 H H H
2.8 23

16. Service Businesses
Facilities-based services - customer goes to the facility
Field-based services - facility goes to the customer

17. Internal Services Internal Supplier Internal Customer External

18. The Service Triangle The Service Strategy The People Systems The
Customer

19. Example Balance for 3 units/hour and compute theoretical min number of stations (primary: longest task time; secondary: most followers) 5 C
10 Min. 11 3 7 3 A B F G I 4 D 12 11 E H

20. Example of Line Balancing: Step 2: Determine Cycle Time
Question: Suppose we only have demand for 3 units per hour. What would our cycle time have to be?
Answer:
Therefore, the maximum task time allowed in a single station is 20 minutes

21. Example of Line Balancing: Step 3: Determine Theoretical Minimum Number of Workstations
Question: What is the theoretical minimum number of workstations for this problem?
Answer:

22. For this example, we’ll use
Example of Line Balancing: Step 4: Rules To Follow for Loading Workstations
A number of simple rules have been proposed for assigning tasks to work stations.
Assign Tasks With The Most Following Tasks First
Assign Tasks With the Longest Task Time First
For this example, we’ll use
Primary: Assign tasks in order of the longest operating time
Secondary (tie-breaking): Assign tasks in order of the largest number of following tasks.

23. Example of Line Balancing:
Step 5: Make assignments A B C D F E G H I
Workstation
Time Left
 Eligible
Will Fit
Assign
Idle Time I 20 10 A
B,E - II 8
B,H E
III 9 4
C,D,H
D,H
C,D D B C IV 6
F,H F G H V 13
Task
Task Time (minutes)
Followers A 10 8 B 11 5 C 3 D 4 E 12 2 F G 7 1 H I 23