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CHAPTER 4. Quality Management. Learning Objectives. Define quality from internal and external orientations. List the dimensions of service quality List the dimensions of quality for manufacturing
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CHAPTER 4 Quality Management
Learning Objectives • Define quality from internal and external orientations. • List the dimensions of service quality • List the dimensions of quality for manufacturing • Summarize the philosophies and contributions of W.Edward Deming,Joseph Juran, Philip Crosby,and Genichi Taguchi • List and explain the components of total quality management • Describe the purpose and use of quality function deployment • List the categories of Baldrige Award criteria and relate them to total quality management • Explain the process and purpose of ISO 9000:2000 certification
Introduction to Quality • Quality is often the first factor customers consider when making a purchase decision. • Federal Express, Motorola, and Four Season Hotels have been able to develop a very strong reputation for high quality. • Integrate quality throughout the organization referred as “quality management”
What is Quality? In general, the definitions can be divided Into: • An internal orientation, from company’s perspective. • An external orientation, from the customer’s perspective.
Internally OrientedDefinitions of Quality An internal Orientation focuses on measuring some characteristics of the service or product. • Quality is the degree to which a specific product conforms to a design or specification. • Differences in quality amount to differences in the quantity of some desired ingredient or attribute. A Company’s assumption that the company's product specifications match what the customer wants is a possible shortcoming of such oriented focused definition.
Externally OrientedDefinitions of Quality External Orientation focus on the customer in two ways: • Quality is fitness for use. • Quality consists of the capacity to satisfy wants.
A Definition of Quality Used by Many Companies: “Quality is consistently meeting or exceeding the customer’s needs and expectations.”
Dimensions of Service Quality • Reliability: The ability to perform the promised service dependably and accurately. • Responsiveness: The willingness to help customers and provide prompt service. • Assurance: The knowledge and courtesy of employees. • Empathy: Individualized attention to customer • Tangibles: The appearance of physical facilities, equipment and personnel.
Reliability: did the express package arrive on time? Was my VCR repaired correctly? Responsiveness: Does the hotel send up an extra pillow when requested? Does the credit card company respond quickly when I have a question about my statement. Assurance: Can the salesperson answer my questions about the computer on sale? Does the car mechanic appear to know about my car? Empathy: Does someone in the restaurant recognize me as regular customer? Is the sales person willing to spend the time to understand my particular needs? Tangibles: Is the hotel room furniture clean and modern? Is my bank statement easy to understand? Examples of Service Quality
Dimension of Quality for Goods • Performance: The primary operating characteristics of a product. • Features: Those secondary characteristics that supplement the product’s basic functioning • Reliability: The length of time a product will function before it fails • Conformance: The degree to which a product’s design and operating characteristics match pre-established standards.
Dimensions of Quality for Goods • Durability: The ability of a product to function when subject to hard and frequent use. • Serviceability: The speed, courtesy, and competence of repair. • Aesthetics: How the product looks , feels, sounds, taste, or smells. • Perceived Quality: The image, advertising, or brand name of a product.
Prevention: Prevention cost result from activities to prevent defects from occurring. They include Special effort to design product Quality Control Procedures Employee Training Appraisal : Appraisal Costs are the costs incurred to measure quality, assess customer satisfaction, and inspect and test products. They include Testing Inspection Audits Costs of Quality
Cost of Quality • Internal Failure: Internal failure cost are those found associated with defects found before the product reaches the customer. Examples: The costs of correcting errors in a customer’s bank account, discarding food that was improperly cooked. Scraping defective parts, or reworking products. • External Failure: External failure cost are incurred after a product has reached the customer. Examples: warranty repair work, handling complaints, or replacing products. Cost of goodwill and lost of customers are also counted in this category.
Six Sigma Concept • Six sigma quality relates to the variability in quality and represents only 3.4 defects pre million, units, or 99.99997% errors free. • The term Six Sigma refers to a broader range of defects prevention strategies. • Motorola has set itself a goal of six sigma quality. • General Electric in its six sigma program trains employees in advance statistical techniques for preventing defects.
W. Edwards Deming System causes most defects Joseph M. Juran Quality planning, quality control, quality improvement Philip Crosby Quality is free, zero defects Genichi Taguchi Taguchi methods, robust design The Background of TQM
Components of TQM • Focus on the customer • Everyone responsible for quality • Team problem solving • Employee training • Fact-based management • Philosophy of continuous improvement
Focus on the Customer • To find out exactly what the customer wants and what he or she likes and dislikes. • Juran's definition of quality as fitness for use provides the groundwork for focusing on the customer. • The more a company understands its customers, the better it will be at meeting or exceeding their needs and expectations
Everyone Responsible for Quality • Everyone must accept responsibility, from the company CEO to the person who cleans the parking lot. • Company suppliers must also accept responsibility for their role in quality. • At Ritz-Carlton, quality extends to every activity at the hotel, even opening the door for someone.
Team Problem Solving • Having a team attack the problem not only allows for different viewpoint but also enables the team members to split the work and to “brainstorm” possible solution with one another • Motorola is one company that has led the way in team problem solving.
Teamwork Project selection Analysis techniques Remedies Results Institutionalization Presentation Motorola’s Criteria for Judging Team Problem Solving
Employee Training and Fact Based Management • Employee needs training to work effectively in groups and to use group problem solving. • Fact-based management force to make decisions base on facts, data, and analysis-instead of intuition. • “ What’s get measured gets attention.”
Components ofContinuous Improvement • Standardize and document procedures • Assign teams to identify areas for improvement • Use methods analysis and problem-solving tools • Use the Plan-Do-Check-Act cycle • Document improved procedures
Categories Leadership Information and analysis Strategic quality planning Human resource utilization Quality assurance of products and services Quality results Customer satisfaction Points 100 70 60 150 140 180 300 Baldrige Award Criteria
ISO 9000 Standards 9000-1: Guidelines 9001: Design through installation and testing 9002: Production through installation and testing 9003: Distributors 9004-1: Model of quality management system
Comparing Baldrige,ISO 9000 and TQM • Baldrige • U.S. Quality Award • Focus on outcomes • ISO 9000 • International standards • Focus on documentation of processes • TQM • Organizational quality philosophy • Foundation of Baldrige criteria
