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Total Quality Management

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Total Quality Management Defined Quality Specifications and Costs Six Sigma Quality and Tools The Shingo System : Fail-Safe ISO 9000 / ISO 14000 Kaizen & Continuous improvement

concepts

OBJECTIVES

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Total Quality Management (TQM)

Total quality management is defined as managing the entire organization so that it excels on all dimensions of products and services that are important to the customer

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Total Quality Management- TQM

Quality: Definition Fitness for use

Meeting specifications & requirements

Customer satisfaction

Faith of user

Competitive cost & Reliability

Best at first

Pride for use

Consistency Safety

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Total Quality Management- TQM

Quality: Definition Fitness for use Meeting specifications & requirements Customer satisfaction Faith of user Competitive cost & Reliability Best at first Pride for use Consistency Safety

Right quality: Definition– Suitability for it’s intended purpose

(Example:- M.D’s table Vs Classroom table)

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Methods of describing quality

Samples Brand names Specifications

Material specifications Performance specifications drawings

Standards Industry National International

Market Grades

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Quality Specifications Quality Characteristics

– Variables – characteristics that are measurable on a numerical scale – e.g. dimensions

– Attributes – a characteristic that cannot be measured on a numerical scale - e.g. the smell of a cologne is characterized as either acceptable or not/ the color of a fabric is either acceptable or not

– Defect – a quality characteristic that does not meet certain standards

– Standard or specification – a set of conditions and requirements

– Quality of design – deals with the stringent conditions that the product or service must minimally possess to satisfy the customer requirements

– Quality of conformance

– Quality of performance - is concerned with how well the product functions or service performs when put to use - It measures the degree to which the product or service satisfies the customer

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Quality Control & Quality Assurance

Quality Assurance

Definition: All those planned or systematic actions necessary to provide confidence that a product or service will satisfy given needs

Evolution of Q.A– Inspection – oriented Quality Assurance– Process control –oriented Quality Assurance– New product development based Quality Assurance

Objective: of Q.A function is to have in place a formal system that continuously surveys the effectiveness of the company quality philosophy

Function: The Q.A Team audits the various departments and assists them in meeting their responsibilities for producing a quality product

Comparative Stance

Quality Assurance – PreventiveQuality Control - Curative

(Popular saying – “Prevention better than Cure”)

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Costs of Quality

External Failure Costs

Appraisal Costs

Prevention Costs

Internal FailureCosts

Costs ofQuality

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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 three standard deviations of the process outputs

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What is Six Sigma?

• It is a methodology for continuous improvement

• It is a methodology for creating products / processes that perform at high standards

• It is a set of statistical and other quality tools arranged in unique way

• It is a way of knowing where you are and where you could be!

• It is a Quality Philosophy and a management technique

Six Sigma is not:

• A standard

• A certification

It is Another metric like percentage

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The evolution of Quality Systems

Quality as InspectionQuality as Inspection

1920-1940’s

Statistical process control

Statistical process control

1940-1960’s

Using statistical techniques for reducing variability – Quality control

Total Quality ManagementTotal Quality Management

1960-1980’s

Organizations tuned towards quality – Quality assurance

Six SigmaSix Sigma

1987 and beyond

Zero defects

Lean Six Sigma

Lean Six Sigma

2000 and beyond

• Lean manufacturing (TPM, JIT, SCM) + Six sigma

• Optimized flow from the customer point of view

Time

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Path to Six Sigma

4 Sigma 6,210 Defects

2 Sigma 308,537 Defects

3 Sigma 66,807 Defects

5 Sigma 233 Defects

6 Sigma 3.4 Defects

Sigma levels and Defects per million

opportunities (DPMO)

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• The term “Six Sigma” was coined by Bill Smith, an engineer with Motorola

• Late 1970s - Motorola started experimenting with problem solving through statistical analysis

• 1987 - Motorola officially launched it’s Six Sigma program

Origin of Six Sigma

MotorolaMotorola the company that invented Six Sigmathe company that invented Six Sigma

MotorolaMotorola the company that invented Six Sigmathe company that invented Six Sigma

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• Jack Welch launched Six Sigma at GE in Jan,1996

• 1998/99 - Green Belt exam certification became the criteria for management promotions

• 2002/03 - Green Belt certification became the criteria for promotion to management roles

The Growth of Six Sigma

GEGEthe company that perfected Six Sigmathe company that perfected Six Sigma

GEGEthe company that perfected Six Sigmathe company that perfected Six Sigma

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The Growth of Six Sigma

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The GE model for process improvements

The Growth of Six Sigma

DDefineefine MMeasureeasure AAnalyzenalyze IImprovemprove CControlontrol

Combination of change management & statistical analysis

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Six Sigma Quality: DMAIC Cycle

Define, Measure, Analyze, Improve, and Control

(DMAIC)

Developed by General Electric as a means of

focusing effort on quality using a methodological

approach

Overall focus of the methodology is to understand

and achieve what the customer wants

A 6-sigma program seeks to reduce the variation

in the processes that lead to these defects

DMAIC consists of five steps….

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Six Sigma Quality: DMAIC Cycle (Continued)

1. Define (D)

2. Measure (M)

3. Analyze (A)

4. Improve (I)

5. Control (C)

Customers and their priorities

Process and its performance

Causes of defects

Remove causes of defects

Maintain quality

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Analytical Tools for Six Sigma and

Continuous Improvement: Flow Chart No, Continue…

Material Received

from Supplier

Inspect Material for

DefectsDefects found?

Return to Supplier for Credit

Yes

Can be used to find quality problems

Can be used to find quality problems

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Analytical Tools for Six Sigma and Continuous Improvement: Run Chart

Can be used to identify when equipment or processes are not behaving according to specifications

Can be used to identify when equipment or processes are not behaving according to specifications

0.440.460.480.5

0.520.540.560.58

1 2 3 4 5 6 7 8 9 10 11 12Time (Hours)

Dia

me

ter

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Analytical Tools for Six Sigma and Continuous Improvement: Pareto Analysis

Can be used to find when 80% of the problems may be attributed to 20% of thecauses

Can be used to find when 80% of the problems may be attributed to 20% of thecauses

Assy.Instruct.

Fre

quen

cy

Design Purch. Training

80%

23Analytical Tools for Six Sigma and Continuous Improvement:

Checksheet

Billing Errors

Wrong Account

Wrong Amount

A/R Errors

Wrong Account

Wrong Amount

Monday

Can be used to keep track of defects or used to make sure people collect data in a correct manner

Can be used to keep track of defects or used to make sure people collect data in a correct manner

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Analytical Tools for Six Sigma and Continuous Improvement: Histogram

Nu

mb

er

of

Lo

ts

Data RangesDefects

in lot

0 1 2 3 4

Can be used to identify the frequency of quality defect occurrence and display quality performance

Can be used to identify the frequency of quality defect occurrence and display quality performance

25Analytical Tools for Six Sigma and Continuous Improvement: Control

Charts

Can be used to monitor ongoing production process quality and quality conformance to stated standards of quality

Can be used to monitor ongoing production process quality and quality conformance to stated standards of quality

970

980

990

1000

1010

1020

0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15

LCL

UCL

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Analytical Tools for Six Sigma and Continuous Improvement: Cause &

Effect Diagram

Effect

ManMachine

MaterialMethod

Environment

Possible causes:Possible causes: The results or effect

The results or effect

Can be used to systematically track backwards to find a possible cause of a quality problem (or effect)

Can be used to systematically track backwards to find a possible cause of a quality problem (or effect)

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Other Six Sigma Tools

Failure Mode and Effect Analysis (FMEA)

is a structured approach to identify,

estimate, prioritize, and evaluate risk of

possible failures at each stage in the

process

Design of Experiments (DOE) a statistical

test to determine cause-and-effect

relationships between process variables

and output

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Six Sigma Roles and Responsibilities

1. Executive leaders must champion the process of improvement

2. Corporation-wide training in Six Sigma concepts and tools

3. Setting stretch objectives for improvement

4. Continuous reinforcement and rewards

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The Shingo System: Fail-Safe Design

Shingo’s argument:– SQC methods do not prevent defects– Defects arise when people make errors– Defects can be prevented by providing

workers with feedback on errors

Poka-Yoke includes:– Checklists– Special tooling that prevents workers from

making errors

Zero-Defect Concept(Total Error-free performance)

• Origin- Missile Industry / later Aviation Industry

• “ To Err is Human” – Training to erase the myth

• Employee awareness programme - direct contribution to the product performance

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ISO 9000

Series of standards agreed upon by the International Organization for Standardization

Adopted in 1987

More than 100 countries

A prerequisite for global competition?

ISO 9000 directs you to "document what you do and then do as you documented"

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Three Forms of ISO Certification

1. First party: A firm audits itself against ISO 9000 standards

2. Second party: A customer audits its supplier

3. Third party: A "qualified" national or international standards or certifying agency serves as auditor

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ISO 14000Quality Management Systems

ORIGIN

• Primarily as a result of Uruguay round of GATT negotiations and RIO summit on environment in 1992.

• Released in the year 1996 as a Global series of Environmental management system standards.

HOW MANY STANDARDS IN EMS ?

• Totally 12 standards (14000 – 14060)

• ISO 14001 is the most critical (“Environmental Management Systems – specifications with guidance for use”)

ISO 14000- WHAT DOES IT COVER AND ACHIEVE ?

• Starts with “environmental policy”

• Provides a framework for organization to demonstrate their commitment to environmental responsibility

• Establishes targets and objectives relates to identified environmental management goals.

• Environmental auditing, environmental labeling, life cycle assessment etc.,

• Prevents pollution , reduced waste and create a good public image.

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Question Bowl

Which of the following are Dimensions of Design Quality?

a. Performanceb. Durabilityc. Aestheticsd. All of the abovee. None of the above

Answer: d. All of the above

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Question Bowl

Approximately what percentage of every sales Rupee is allocated to the “cost of quality”?

a. Less than 5%b. About 10%c. Between 15 and 20 %d. More than 30%e. None of the aboveAnswer: c. Between 15 and 20 % (for cost of reworking, scrapping, repeated service, etc.)

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Question Bowl

Which of the following are classifications of the “cost of quality”?

a. Appraisal costsb. Prevention costsc. Internal failure costsd. External failure costse. All of the above

Answer: e. All of the above

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Question Bowl

Which of the following are functions of a quality control department?

a. Testing product designs for reliabilityb. Gathering product performance datac. Planning and budgeting the QC

programd. All of the abovee. None of the above

Answer: d. All of the above

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Question Bowl

Which of the following is a Critical Customer Requirement (CCR) in the context of a Six Sigma program?

a. DMAICb. DPMOc. PDCAd. DOEe. None of the above

Answer: e. None of the above (The CCR is the criteria that is used to define desired quality. Processing a loan in 10 days is an example of a CCR.)

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Question Bowl

The DMAIC cycle of Six Sigma is similar to which of the following quality management topics?

a. Continuous improvementb. Servqualc. ISO 9000d. External benchmarking e. None of the above

Answer: a. Continuous improvement

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Question Bowl

The “A” in DMAIC stands for which of the following?

a. Alwaysb. Accessibilityc. Analyzed. Acte. None of the aboveAnswer: c. Analyze (Define, Measure, Analyze, Improve and Control)

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Question Bowl

Which of the following analytical tools depict trends in quality data over time?

a. Flowchartsb. Run chartsc. Pareto chartsd. Checksheetse. Cause and effect diagrams

Answer: b. Run charts