quality management

Quality Quality ManagementManagement

Confidential to SoftTech Engineers Pvt. Ltd. Pune

Quality is the ability of a product or service to consistently meet or exceed customer expectations.

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What is Quality


Evolution of Quality Management

• 1924 - Statistical process control charts• 1930 - Tables for acceptance sampling• 1940’s - Statistical sampling techniques• 1950’s - Quality assurance/TQC• 1960’s - Zero defects• 1970’s - Quality assurance in services

9-3Confidential to SoftTech Engineers Pvt. Ltd. Pune

Quality Assurance vs. Strategic Approach

• Quality Assurance– Emphasis on finding and correcting defects before

reaching market• Strategic Approach

– Proactive, focusing on preventing mistakes from occurring

– Greater emphasis on customer satisfaction


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


Key Contributors to Quality Management

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Contributor

Deming Juran Feignbaum Crosby Ishikawa Taguchi Ohno and Shingo

Known for

14 points; special & common causes of variation Quality is fitness for use; quality trilogy Quality is a total field Quality is free; zero defects Cause-and effect diagrams; quality circles Taguchi loss function Continuous improvenment

Quali ty


Principles of Quality Management

• Quality management is becoming increasingly important to

the leadership and management of all organisations.

• It is necessary to identify Quality Management as a distinct

discipline of management and lay down universally

understood and accepted rules for this discipline.



"A quality management principle is a comprehensive and

fundamental rule / belief, for leading and operating an

organisation, aimed at continually improving performance

over the long term by focusing on customers while

addressing the needs of all other stake holders".



The Eight Principles are:

1. Customer-Focused Organisation

2. Leadership

3. Involvement of People

4. Process Approach

5. System Approach to Management

6. Continual Improvement

7. Factual Approach to Decision Making and

8. Mutually Beneficial Supplier Relationships.Confidential to SoftTech Engineers Pvt. Ltd. Pune


Principle 1: Customer Focused Organisation

Organizations depend on their customers and therefore should

understand current and future customer needs, meet customer

requirements and strive to exceed customer expectations.



Principle 1: Customer Focused OrganisationApplying the principle of customer-focused organisation leads to the following actions:• Understanding the whole range of customer needs and expectations for products, delivery, price, dependability, etc.• Ensuring a balanced approach among customers and other stakeholders (owners, people, suppliers, local communities and society at large) needs and expectations.• Communicating these needs and expectations throughout the organisation, • Measuring customer satisfaction and acting on results, and • Managing customer relationships.



Principle 1: Customer Focused OrganisationBeneficial applications of this principle include:For policy and strategy formulation, making customer needs and the needs of other stakeholders understood throughout the organisation;For goal and target setting, ensuring that relevant goals and targets are directly linked to customer needs and expectations;For operational management, improving the performance of the organisation to meet customer needs;For human resources management, ensuring the people have the knowledge and skills required to satisfy the organisation’s customers.



Principle 2: Leadership

Leaders establish unity of purpose and direction of the

organisation. They should create and maintain the internal

environment in which people can become fully involved in

achieving the organisation’s objectives.



Principle 2: LeadershipApplying the principle of leadership leads to the following actions:• Being proactive and leading by example,• Understanding and responding to changes in the external environment,• Considering the needs of all stakeholders including customers, owners, people, suppliers, local communities and society at large,• Establishing a clear vision of the organisation’s future,• Establishing shared values and ethical role models at all levels of the organisation,• Building trust and eliminating fear,



Principle 2: Leadership• Providing people with the required resources and freedom to act with responsibility and accountability,• Inspiring, encouraging and recognizing people’s contributions,• Promoting open and honest communication,• Educating, training and coaching people,• Setting challenging goals and targets, and• Implementing strategy to achieve these goals and targets.



Principle 2: LeadershipBeneficial applications of this principle include:For policy and strategy formulation, establishing and communicating a clear vision of the organisation’s future;For goal and target setting, translating the vision of the organisation into measurable goals and targets;For operational management, empowered and involved people achieve the organisation’s objectives;For human resource management, having an empowered, motivated, well informed and stable workforce.



Principle 3: Involvement of people

People at all levels are the essence of an organisation and their full

involvement enables their abilities to be used for the organisation’s

benefit.



Principle 3: Involvement of peopleApplying the principle of involvement of people leads to the following actions by the people:• Accepting ownership and responsibility to solve problems,• Actively seeking opportunities to make improvements,• Actively seeking opportunities to enhance their competencies, knowledge and experience,• Freely sharing knowledge and experience in teams and groups,• Focusing on the creation of value for customers,



Principle 3: Involvement of people• Being innovative and creative in furthering the organisations objectives,• Better representing the organisation to customers, local communities and society at large,• Deriving satisfaction from their work, and be enthusiastic and proud to be part of the organisation.



Principle 3: Involvement of peopleBeneficial applications of this principle include:• For policy and strategy formulation, people effectively contributing to improvement of the policy and strategies of the organisation;• For goal and target setting, people sharing ownership of the organisation’s goals;• For operational management, people being involved in appropriate decisions and process improvements;• For human resource management, people being more satisfied with their jobs and being actively involved in their personal growth and development, for the organisation’s benefit.



Principle 4: Process approach

A desired result is achieved more efficiently when activities and related resources are managed as a process.



Principle 4: Process approachApplying the principle of process approach leads to the following actions:• Defining the process to achieve the desired result,• Identifying and measuring the inputs and outputs of the process,• Identifying the interfaces of the process with the functions of the organisation,• Evaluating possible risks, consequences and impacts of processes on customers, suppliers and other stakeholders of the process,



Principle 4: Process approach• Establishing clear responsibility, authority, and accountability for managing the process,• Identifying the internal and external customers, suppliers and other stakeholders of the process• When designing processes, consideration is given to process steps, activities, flows, control measures, training needs, equipment, methods, information, materials and other resources to achieve the desired result.



Principle 4: Process approachBeneficial applications of this principle include:For policy and strategy formulation, utilizing defined processes throughout the organisation will lead to more predictable results, better use of resources, shorter, cycle times and lower costs;For goal and target setting, understanding the capability of processes enables the creation of challenging goals and targets;for operational management, adopting the process approach for all operations results in lower costs, prevention of errors, control of variation, shorter cycle times and more predictable outputs;



Principle 4: Process approachFor human resource management establishing cost efficient processes for human resource management, such as hiring, education and training, enables the alignment of these processes with the needs of the organisation and produces a more capable workforce.



Principle 5: System approach to management

Identifying, understanding and managing a system of interrelated

processes for a given objective improves the organisation’s

effectiveness and efficiency.



Principle 5: System approach to managementApplying the principle of system approach to management leads to the following actions:• Defining the system by identifying or developing the processes that affect a given objective,• Structuring the system to achieve the objective in the most efficient way,• Understanding the interdependencies among the processes of the system,• Continually improving the system through measurement and evaluation, and• Establishing resource constraints prior to action.



Principle 5: System approach to managementBeneficial applications of this principle include:• For policy and strategy formulation, the creation of comprehensive and challenging plans that link functional and process inputs;• For goal and target setting, the goals and targets of individual processes are aligned with the organisation’s key objectives;• For operational management, a broader overview of the effectiveness of processes which leads to understanding the causes of problems and timely improvement actions;• For human resource management, provides a better understanding of roles and responsibilities for achieving common objectives thereby reducing cross functional barriers and improving teamwork.



Principle 6: Continual improvement

Continual improvement should be a permanent objective of the

organisation.



Principle 6: Continual improvementApplying the principle of continual improvement leads to the following actions:• Making continual improvement of products, processes and systems an objective for every individual in the organisation,• Applying the basic improvement concepts of incremental improvement and breakthrough improvement,• Using periodic assessments against established criteria of excellence to identify areas for potential improvement,• Continually improving the efficiency and effectiveness of all processes,• Promoting prevention based activities,



Principle 6: Continual improvement• Providing every member of the organisation with appropriate education and training, on the methods and tools of continual improvement such as:• The Plan-Do-Check-Act cycle,• Problem solving, process re-engineering, and process innovation,• Establishing measures and goals to guide and track improvements, and recognizing improvements.



Principle 6: Continual improvementBeneficial applications of this principle include:For policy and strategy formulation, creating and achieving more competitive business plans through the integration of continual improvement with strategic and business planning;For goal and target setting, setting realistic and challenging improvement goals and providing the resources to achieve them;For operational management, involving people in the organisation in the continual improvement of processes;For human resource management, providing all people in the organisation with the tools, opportunities, and encouragement to improve products, processes and systems.



Principle 7: Factual approach to decision makingEffective decisions are based on the analysis of data and information.

Applying the principle of factual approach to decision making leads to the following actions:• Taking measurements and collecting data and information relevant to the objective,• Ensuring the data and information are sufficiently accurate, reliable and accessible,• Analysing the data and information using valid methods,• Understanding the value of appropriate statistical techniques, and making decisions and taking action based on the results of logical analysis balance with experience and intuition.



Principle 7: Factual approach to decision makingBeneficial applications of this principle include:For policy and strategy formulation, strategies based on relevant data and information are more realistic and more likely to be achieved;For goal and target setting, using relevant comparative data and information to set realistic and challenging goals and targets;For operational management, data and information are the basis for understanding both process and system performance to guide improvements and prevent future problems;For human resource management, analysing data and information from sources such as people surveys, suggestions and focus groups to guide the formulation of human resource policies.



Principle 8: Mutually beneficial supplier relationships

An organisation and its suppliers are interdependent, and a mutually

beneficial relationship enhances the ability of both to create value.



Principle 8: Mutually beneficial supplier relationshipsApplying the principle of mutually beneficial supplier relationships leads to the following actions:• Identifying and selecting key suppliers,• Establishing supplier relationships that balance short-term gains with long-term considerations for the organisation and society at large,• Creating clear and open communications, initiating joint development and improvement of products and processes, jointly establishing a clear understanding of customers’ needs,• Sharing information and future plans, and recognizing supplier improvements and achievements.



Principle 8: Mutually beneficial supplier relationshipsBeneficial applications of this principle include:For policy and strategy formulation, creating competitive advantage through the development of strategic alliances or partnerships with suppliers;For goal and target setting, establishing more challenging goals and targets through early involvement and participation of suppliers;For operational management, creating and managing supplier relationships to ensure reliable, on-time, defect-free delivery of supplies;For human resource management, developing and enhancing supplier capabilities through supplier training, and joint improvement efforts


Dimensions of Quality

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• 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

• Durability - useful life of the product/service

• Perceived Quality - indirect evaluation of quality (e.g. reputation)

• Serviceability - service after sale


Examples of Quality Dimensions

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Dimension

1. Performance 2. Aesthetics 3. Special features

(Product) Automobile

Everything works, fit & finish Ride, handling, grade of materials used Interior design, soft touch Gauge/control placement Cellular phone, CD player

(Service) Auto Repair

All work done, at agreed price Friendliness, courtesy, Competency, quickness Clean work/waiting area Location, call when ready Computer diagnostics


Examples of Quality Dimensions (Cont’d)

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Dimension

5. Reliability 6. Durability 7. Perceived quality 8. Serviceability

(Product) Automobile

Infrequency of breakdowns Useful life in miles, resistance to rust & corrosion Top-rated car Handling of complaints and/or requests for information

(Service) Auto Repair

Work done correctly, ready when promised Work holds up over time Award-winning service department Handling of complaints


Service Quality

• Convenience• Reliability• Responsiveness• Time• Assurance• Courtesy• Tangibles


Examples of Service Quality

Dimension Examples1. Convenience Was the service center conveniently located?

2. Reliability Was the problem fixed?

3. Responsiveness Were customer service personnel willing and able to answer questions?

4. Time How long did the customer wait?

5. Assurance Did the customer service personnel seem knowledgeable about the repair?

6. Courtesy Were customer service personnel and the cashier friendly and courteous?

7. Tangibles Were the facilities clean, personnel neat?

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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


Determinants of Quality

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Service

Ease ofuse

Conforms to design

Design


Determinants of Quality (cont’d)

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• Quality of design– Intension of designers to include or exclude features in a

product or service• Quality of conformance

– The degree to which goods or services conform to the intent of the designers


The Consequences of Poor Quality

• Loss of business• Liability• Productivity• Costs


Responsibility for Quality

• Top management• Design• Procurement• Production/operations• Quality assurance• Packaging and shipping• Marketing and sales• Customer service


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.


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


Ethics and Quality

• Substandard work– Defective products– Substandard service– Poor designs– Shoddy workmanship– Substandard parts and materials

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Having knowledge of this and failing to correctand report it in a timely manner is unethical.


Quality Awards

• Malcolm Baldrige National Quality Award

05/03/23 Confidential to SoftTech Engineers Pvt. Ltd. Pune

Quality Awards

• 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

Quality Awards

• European Quality Award


Prizes intended to identify role models

• Leadership

• Customer focus

• Corporate social responsibility

• People development and involvement

• Results orientation

Quality Awards

• The Deming Prize


• Honoring W. Edwards Deming

• Japan’s highly coveted award

• Main focus on statistical quality control

(The Deming Prize is a Japanese award given to companies to recognize their efforts in quality improvement. The award is named after W. Edwards Deming, who visited Japan after World War II upon the request of Japanese industrial leaders and engineers.While there, he gave a series of lectures on quality. The Japanese consideredhim such an important quality guru that they named the quality award after him.)

Quality Certification

• ISO 9000

– Set of international standards on quality management

and quality assurance, critical to international business

• ISO 14000

– A set of international standards for assessing a

company’s environmental performance


ISO 9000 Standards

Requirements

– System requirements

– Management

– Resource

– Realization

– Remedial


ISO 9000 Standards

In December 2000 the first major changes to ISO 9000 were made, introducing the following three new standards:

ISO 9000:2000–Quality Management Systems–Fundamentals and Standards: Provides the terminology and definitions used in the standards. It is the starting point for understanding the system of standards.

ISO 9001:2000–Quality Management Systems–Requirements: This is the standard used for the certification of a firm’s quality management system. It is used to demonstrate the conformity of quality management systems to meet customer requirements.

ISO 9004:2000–Quality Management Systems–Guidelines for Performance: Provides guidelines for establishing a quality management system. It focuses not only on meeting customer requirements but also on improving performance.


ISO 9000 Quality Management Principles

• Customer focus• Leadership• People involvement• Process approach• A systems approach to management• Continual improvement• Factual approach to decision making• Mutually beneficial supplier relationships


ISO 14000

• ISO 14000 - A set of international standards for assessing a

company’s environmental performance

• Standards focus on three major areas– Management systems standards measure systems development

and integration of environmental responsibility into the overall business.

– Operations standards include the measurement of consumption of natural resources and energy.

– Environmental systems standards measure emissions, effluents, and other waste systems.


Total Quality Management

A philosophy that involves everyone in an organization in a

continual effort to improve quality and achieve customer

satisfaction.

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T Q M


The TQM Approach

1. Find out what the customer wants

2. Design a product or service that meets or exceeds customer wants

3. Design processes that facilitates doing the job right the first time

4. Keep track of results

5. Extend these concepts to suppliers


Elements of TQM

1. Continual improvement

2. Competitive benchmarking

3. Employee empowerment

4. Team approach

5. Decisions based on facts

6. Knowledge of tools

7. Supplier quality

8. Champion

9. Quality at the source

10. Suppliers


Continuous Improvement

• Philosophy that seeks to make never-ending improvements

to the process of converting inputs into outputs.

• Kaizen: Japanese

word for continuous

improvement.


Quality at the Source

The philosophy of making each worker responsible for the quality of his or her

work.


Six Sigma

• Statistically– Having no more than 3.4 defects per million

• Conceptually– Program designed to reduce defects– Requires the use of certain tools and techniques

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Six sigma: A business process for improving quality, reducing costs, and increasing customer satisfaction.


Six Sigma Programs

• Six Sigma programs – Improve quality– Save time– Cut costs

• Employed in – Design– Production– Service– Inventory management– Delivery


Six Sigma Management

• Providing strong leadership

• Defining performance metrics

• Selecting projects likely to succeed

• Selecting and training appropriate people


Six Sigma Technical

• Improving process performance

• Reducing variation

• Utilizing statistical models

• Designing a structured improvement strategy


Six Sigma Team

• Top management• Program champions• Master “black belts”• “Black belts”• “Green belts”


Six Sigma Process

• Define

• Measure

• Analyze

• Improve

• Control

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DMAIC


Obstacles to Implementing TQM

• Lack of:– Company-wide definition of quality– Strategic plan for change– Customer focus– Real employee empowerment– Strong motivation– Time to devote to quality initiatives– Leadership


• Poor inter-organizational communication

• View of quality as a “quick fix”

• Emphasis on short-term financial results

• Internal political and “turf” wars

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Obstacles to Implementing TQM


Criticisms of TQM

1. Blind pursuit of TQM programs

2. Programs may not be linked to strategies

3. Quality-related decisions may not be tied to market

performance

4. Failure to carefully plan a program


Basic Steps in Problem Solving

1. Define the problem and establish an improvement goal2. Define measures and collect data3. Analyze the problem4. Generate potential solutions5. Choose a solution6. Implement the solution7. Monitor the solution to see if it accomplishes the goal


The PDSA Cycle

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Plan

Do

Study

Act


The Process Improvement Cycle

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Implement theImproved process

Select aprocess

Study/document

Seek ways toImprove it

Design anImproved process

Evaluate

Document


Process Improvement

Process Improvement: A systematic approach to improving a

process

• Process mapping

• Analyze the process

• Redesign the process


Process Improvement and Tools

• Process improvement - a systematic approach to improving a process– Process mapping– Analyze the process– Redesign the process

• Tools– There are a number of tools that can be used for

problem solving and process improvement– Tools aid in data collection and interpretation, and

provide the basis for decision making


Basic Quality Tools

• Flowcharts

• Check List

• Histograms

• Pareto Charts

• Scatter diagrams

• Control charts

• Cause-and-effect diagrams

• Run charts


Basic Quality Tools

Flowcharts• A flowchart is a schematic diagram of the sequence of steps

involved in an operation or process. It provides a visual tool that is easy to use and understand.

• By seeing the steps involved in an operation or process, everyone develops a clear picture of how the operation works and where problems could arise.


Basic Quality Tools

Checklist• Checklists are a simple way of gathering data so that decisions

can be based on facts, rather than anecdotal evidence. • It is a simple yet effective fact-finding tool that allows the worker

to collect specific information regarding the defects observed.


Basic Quality Tools

Histogram• A histogram is a chart that shows the frequency distribution

of observed values of a variable.


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80% of the problems may be

attributed to 20% of the

causes.

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ects

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Pareto Analysis: Few quality problems are important, whereas many others are not critical.

Basic Quality Tools


Scatter diagrams are graphs that show how two variables arerelated to one another. They are particularly useful in detecting the amount of correlation, or the degree of linear relationship, between two variables.

Basic Quality Tools


Control Chart: The charts are made by plotting in sequence the

measured values of samples taken from a process.

Basic Quality Tools

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Cause-and-Effect Diagram: They are charts that identify potential causes for particular quality problems. They are often called fishbone diagrams because they look like the bones of a fish. The “head” of the fish is the quality problem.


Basic Quality Tools

Run Chart

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Time (Hours )

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0.520.540.560.58

1 2 3 4 5 6 7 8 9 10 11 12

Time (Hours)

Diam

eter


Basic Quality Tools

Tracking Improvements

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UCL

LCL

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UCLUCL

Process not centeredand not stable

Process centeredand stable

Additional improvementsmade to the process


Methods for Generating Ideas

• Brainstorming

• Quality circles

• Interviewing

• Benchmarking• 5W2H (Who, What, When, Where, Why, How, How Much)


Quality Circles

• Team approach

– List reduction

– Balance sheet

– Paired comparisons


Benchmarking Process

• Identify a critical process that needs improvement

• Identify an organization that excels in this process

• Contact that organization

• Analyze the data

• Improve the critical process


quality management

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