In this chapter we shall be concerned with the definition of the concept of quality. Such definitions are important, for it may mean different things to different people in various circumstances. The industrial notions of quality, although dear and weIl stated, need not be the true measures of quality. Although they are important and serve many purposes, they are only part of a larger picture.
Chapter 1 Introduction to Quality Modern 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 October 1887 Key Idea Building—and maintaining—quality into an organization’s goods and services, and more importantly, into the infrastructure of the organization itself, is not an easy task The Importance of Quality Japanese success Impact of quality on productivity and profit Costs of quality Quality as a competitive advantage Quality and Productivity I. Market Gains Improved: •Performance •Reliability •Features •etc Improved reputation for quality Increased Market share Higher Prices Experience based scale economies Increased Profits Quality and Productivity II. Cost Savings Increased productivity Improved reliability or conformance Lower manufacturing costs Lower rework and scrap costs Lower warranty and product liability costs Increased Profits Lower service costs Relative Quality Boosts rates of return % 50 40 ROS ROI 30 20 10 I nferior 20 40 60 80 Superior Relative quality (percentile) The Costs of Quality Prevention Costs Appraisal Costs Internal Failure Costs External Failure Costs Costs of quality assurance Prevention Costs QC administration and systems planning Quality training Quality planning (QC engineering work) Incoming, in process, final inspection Special processes planning Quality data analysis Procurement planning Vendor surveys Reliability studies Quality measurement and control equipment Qualification of material Source: Adapted form J. W. Gavett, Production and Operations Management (New York: Harcourt Brace Jovanovich Costs of quality assurance Appraisal Costs Testing Inspection Quality audits Incoming test and inspection and laboratory acceptance Checking labor Laboratory or other measurement service Setup for test and inspection Test and inspection material Outside endorsement Maintenance and calibration Product engineering review and shipping release Field testing Source: Adapted form J. W. Gavett, Production and Operations Management (New York: Harcourt Brace Jovanovich Quality Perspectives transcendent & valuebased Customer products and services userbased needs Marketing productbased Design manufacturing based Manufacturing Distribution Information flow Product flow 22 TOTAL QUALITY INTERFACES CONSUMER NEEDS/REQUIREMENTS QUALITY QUALITY OF PERFORMANCE QUALITY OF DESIGN QUALITY OF CONFORMANCE WORK PROCESS/SYSTEM Quality as a Management Framework GE study Quality as a “management discipline” and not just a “technical discipline” Total quality control, companywide quality control, total quality management, TQ Principles of Total Quality Customer and stakeholder focus Participation and teamwork Process focus supported by continuous improvement and learning …all supported by an integrated organizational infrastructure, a set of management practices, and a set of tools and techniques 25 Customer and Stakeholder Focus Customer is principal judge of quality Organizations must first understand customers’ needs and expectations in order to meet and exceed them Organizations must build relationships with customers Customers include employees and society at large 26 Key Idea To meet or exceed customer expectations, organizations must fully understand all product and service attributes that contribute to customer value and lead to satisfaction and loyalty Participation and Teamwork Employees know their jobs best and therefore, how to improve them Management must develop the systems and procedures that foster participation and teamwork Empowerment better serves customers, and creates trust and motivation Teamwork and partnerships must exist both horizontally and vertically 28 Key Idea In any organization, the person who best understands his or her job and how to improve both the product and the process is the one performing it Process Focus and Continuous Improvement A process is a sequence of activities that is intended to achieve some result 30 Continuous Improvement Enhancing value through new products and services Reducing errors, defects, waste, and costs Increasing productivity and effectiveness Improving responsiveness and cycle time performance Key Idea Major improvements in response time may require significant simplification of work processes and often drive simultaneous improvements in quality and productivity Deming’s View of a Production System Suppliers of materials and equipment Design and Redesign Receipt and test of materials A B C D Consumer research Consumers Production, assembly inspection Distribution Tests of processes, machines, methods INPUTS PROCESSES OUTPUTS Feedback 33 Learning The foundation for improvement … Understanding why changes are successful through feedback between practices and results, which leads to new goals and approaches Learning cycle: – – – – Planning Execution of plans Assessment of progress Revision of plans based on assessment findings Infrastructure, Practices, and Tools Infrastructure Leadership Strategic Planning Practices Tools HRM Performance appraisal Process mgt Information and knowledge management Training Trend chart 35 TQ Infrastructure Customer relationship management Leadership and strategic planning Human resources management Process management Information and knowledge management 36 ... GE study Quality? ?as a ? ?management? ?discipline” and? ?not just a “technical discipline” Total? ?quality? ?control, companywide quality? ?control, total? ?quality? ? management, TQ Principles? ?of? ?Total? ?Quality. .. not an easy task The? ?Importance? ?of? ?Quality Japanese success Impact? ?of? ?quality? ?on productivity? ?and? ? profit Costs? ?of? ?quality? ? Quality? ?as a competitive advantage Quality? ?and? ?Productivity... infrastructure, a set? ?of? ?management? ?practices, and? ?a set? ?of? ?tools? ?and? ?techniques 25 Customer? ?and? ?Stakeholder Focus Customer is principal judge? ?of? ?quality Organizations must first understand customers’ needs? ?and? ?expectations in