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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.”

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Chapter 1

Chapter 1

Introduction to Quality


Modern importance of 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


Quality assurance

Quality Assurance

...is any action directed toward providing customers with goods and services of appropriate quality.


History of quality assurance 1 of 3

History of Quality Assurance (1 of 3)

  • Skilled craftsmanship during the Middle Ages

    • Pride in workmanship

    • Quality assurance informal

  • Interchangeable parts

    • Quality assurance critical

  • Industrial Revolution

    • Rise of inspection and separate quality departments


History of quality assurance 2 of 3

History of Quality Assurance (2 of 3)

  • Statistical quality control (SQC) developed at Western Electric (Bell System)

  • Quality control during World War II

  • Quality management in Japan

    • Statistical quality control

    • Continuous improvement


History of quality assurance 3 of 3

History of Quality Assurance (3 of 3)

  • Quality awareness in U.S. manufacturing industry during 1980s

    • Malcolm Baldrige National Quality Award (1987)

  • American companies win Japan’s Deming Prize

  • Quality in service industries, government, health care, and education


Contemporary influences on quality

Contemporary Influences on Quality

  • Partnering

  • Learning systems

  • Adaptability and speed of change

  • Environmental sustainability

  • Globalization

  • Knowledge focus

  • Customization and differentiation

  • Shifting demographics


Definitions of quality

Definitions of Quality

  • Transcendent definition

    • excellence

  • Product-based definition

    • quantities of product attributes

  • User-based definition

    • fitness for intended use

  • Value-based definition

    • quality vs. price

  • Manufacturing-based definition

    • conformance to design specifications


Quality perspectives

transcendent &

product-based

user-based

needs

Marketing

Customer

value-based

Design

products

and

services

manufacturing-

based

Manufacturing

Distribution

Information flow

Product flow

Quality Perspectives


Customer driven quality

Customer-Driven Quality

  • “Meeting or exceeding customer expectations”

  • Customers can be...

    • Consumers

    • External customers

    • Internal customers


Total quality

Total Quality

  • People-focused management system

  • Focuses on increasing customer satisfaction and reducing costs

  • A systems approach that integrates organizational functions and the entire supply chain

  • Stresses learning and adaptation to change

  • Based on the scientific method


Principles of total quality

Principles of Total Quality

  • Customer and stakeholder focus

  • Participation and teamwork

  • Process focus and continuous improvement

...supported by an integrated organizational

infrastructure, a set of management practices,

and a set of tools and techniques


Customer and stakeholder focus

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


Participation and teamwork

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


Process focus and continuous improvement

Process Focus and Continuous Improvement

  • A process is a sequence of activities that is intended to achieve some result


Continuous improvement

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


Deming s view of a production system

Suppliers of

materials and

equipment

Design and

Redesign

Consumer

research

Receipt and test

of materials

Consumers

A

B

C

D

Production, assembly

inspection

Distribution

Tests of processes, machines, methods

INPUTSPROCESSESOUTPUTS

Deming’s View of a Production System


Learning

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, Practices, and Tools

Infrastructure

Leadership Strategic HRM Process Data and information

Planning mgt. management

Performance Training

appraisal

Practices

Trend chart

Tools


Total quality infrastructure

Total Quality Infrastructure

  • Customer relationship management

  • Leadership and strategic planning

  • Human resources management

  • Process management

  • Data and information management


Competitive advantage

Competitive Advantage

  • Is driven by customer wants and needs

  • Makes significant contribution to business success

  • Matches organization’s unique resources with opportunities

  • Is durable and lasting

  • Provides basis for further improvement

  • Provides direction and motivation

Quality supports each of these characteristics


Quality and profitability

Quality and Profitability

Improved quality of design

Improved quality of conformance

Higher perceived value

Higher prices

Lower manufacturing and service costs

Increased market share

Increased revenues

Higher profitability


Evidence that quality impacts business results

Evidence that Quality Impacts Business Results

  • General Accounting Office study of Baldrige Award applicants

  • Baldrige stock study

    (see www.quality.nist.gov)

  • Hendricks and Singhal study of quality award winners

  • Performance results of Baldrige Award winners


Gao total quality model

Reliability

Overall satisfaction

Product and

service quality

Customer

satisfaction

On-time delivery

Customer retention

Error/defects

Complaints

Leadership for

continuous

improvement

Market share

Competitiveness

Profits

Costs

Quality systems and

employee involvement

Cycle time

Organization

benefits

Turnover

Satisfaction

Safety & health

Productivity

GAO Total Quality Model


Three levels of quality

Three Levels of Quality

  • Organizational level: meeting external customer requirements

  • Process level: linking external and internal customer requirements

  • Performer/job level: meeting internal customer requirements


Quality and personal values

Quality and Personal Values

  • Personal initiative has a positive impact on business success

  • Quality begins with personal attitudes

  • Quality-focused individuals often exceed customer expectations

  • Attitudes can be changed through awareness and effort (e.g., personal quality checklists)


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