1. McGraw-Hill/Irwin Copyright © 2007 by The McGraw-Hill Companies, Inc. All rights reserved. 9 Quality Management

2. 9-2 The Quality Gurus  Walter Shewhart  “Father of statistical quality control”  W. Edwards Deming  Joseph M. Juran  Armand Feignbaum  Philip B. Crosby  Kaoru Ishikawa  Genichi Taguchi

3. 9-3 Key Contributors to Quality Management Table 9.2

4. 9-4 Key Contributors to Quality Management  Shewhart  Plan-Do-Study-Act Improvement Cycle  Operational Definitions  Statistical Process Control

5. 9-5 Dimensions of Quality  Performance - main characteristics of the product/service  Aesthetics - appearance, feel, smell, taste  Special Features - extra characteristics  Conformance - how well product/service conforms to customer’s expectations  Reliability - consistency of performance

6. 9-6 Dimensions of Quality (Cont’d)  Durability - useful life of the product/service  Perceived Quality - indirect evaluation of quality (e.g. reputation)  Serviceability - service after sale

7. 9-7 Examples of Quality Dimensions

8. 9-8 Examples of Quality Dimensions (Cont’d)

9. 9-9 Service Quality  Convenience  Reliability  Responsiveness  Time  Assurance  Courtesy  Tangibles

10. 9-10 Examples of Service Quality DimensionExamples 1. ConvenienceWas the service center conveniently located? 2. ReliabilityWas the problem fixed? 3. ResponsivenessWere customer service personnel willing and able to answer questions? 4. TimeHow long did the customer wait? 5. AssuranceDid the customer service personnel seem knowledgeable about the repair? 6. CourtesyWere customer service personnel and the cashierfriendly and courteous? 7. TangiblesWere the facilities clean, personnel neat? Table 9.4

11. 9-11 Challenges with Service Quality  Customer expectations often change  Different customers have different expectations  Each customer contact is a “moment of truth”  Customer participation can affect perception of quality  Fail-safing must be designed into the system

12. 9-12 The Consequences of Poor Quality  Loss of business  Liability  Productivity  Costs

13. 9-13 Costs of Quality  Failure Costs - costs incurred by defective parts/products or faulty services.  Internal Failure Costs  Costs incurred to fix problems that are detected before the product/service is delivered to the customer.  External Failure Costs  All costs incurred to fix problems that are detected after the product/service is delivered to the customer.

14. 9-14 Costs of Quality (continued)  Appraisal Costs  Costs of activities designed to ensure quality or uncover defects  Prevention Costs  All TQ training, TQ planning, customer assessment, process control, and quality improvement costs to prevent defects from occurring

15. 9-15  Substandard work  Defective products  Substandard service  Poor designs  Shoddy workmanship  Substandard parts and materials Ethics and Quality Having knowledge of this and failing to correct and report it in a timely manner is unethical.

16. 9-16 Quality Awards Baldrige Award Deming Prize

17. 9-17 Malcolm Baldrige National Quality Award  1.0 Leadership (125 points)  2.0 Strategic Planning (85 points)  3.0 Customer and Market Focus (85 points)  4.0 Information and Analysis (85 points)  5.0 Human Resource Focus (85 points)  6.0 Process Management (85 points)  7.0 Business Results (450 points)

18. 9-18 Benefits of Baldrige Competition  Financial success  Winners share their knowledge  The process motivates employees  The process provides a well-designed quality system  The process requires obtaining data  The process provides feedback

19. 9-19 The PDSA Cycle Plan Do Study Act Figure 9.2

20. 9-20 The Process Improvement Cycle Implement the Improved process Select a process Study/document Seek ways to Improve it Design an Improved process Evaluate Document Figure. 9.3

21. 9-21 Basic Quality Tools  Flowcharts  Check sheets  Histograms  Pareto Charts  Scatter diagrams  Control charts  Cause-and-effect diagrams  Run charts

22. 9-22 Check Sheet Billing Errors Wrong Account Wrong Amount A/R Errors Wrong Account Wrong Amount Monday

23. 9-23 Pareto Analysis 80% of the problems may be attributed to 20% of the causes. 80% of the problems may be attributed to 20% of the causes. Smeared print Number of defects Off center Missing label Loose Other

24. 9-24 Control Chart 970 980 990 1000 1010 1020 0123456789101112131415 UCL LCL Figure 9.11

25. 9-25 Tracking Improvements UCL LCL UCL Process not centered and not stable Process centered and stable Additional improvements made to the process Figure 9-18

26. 9-26 Cause-and-Effect Diagram Figure 9.12 Effect MaterialsMethods EquipmentPeople Environment Cause

27. 9-27 Run Chart Time (Hours) Diameter