quality management & tqm-modified

8/20/2019 Quality Management & TQM-modified

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© 2011 Pearson Education,

Inc. publishing as Prentice

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When you complete this chapter you should be able to:

1.1.1.1. Define quality and TQMDefine quality and TQMDefine quality and TQMDefine quality and TQM

2.2.2.2. Describe the ISO international qualityDescribe the ISO international qualityDescribe the ISO international qualityDescribe the ISO international qualitystandardsstandardsstandardsstandards

3.3.3.3. Explain Six SigmaExplain Six SigmaExplain Six SigmaExplain Six Sigma

4.4.4.4. Explain how benchmarking is usedExplain how benchmarking is usedExplain how benchmarking is usedExplain how benchmarking is used

5.5.5.5. UseUseUseUse the seven tools of TQMthe seven tools of TQMthe seven tools of TQMthe seven tools of TQM

© 2011 Pearson Education,Inc. publishing as Prentice

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ImprovedQuality

IncreasedProfits

Increased productivityIncreased productivityIncreased productivityIncreased productivity

Lower rework and scrap costsLower rework and scrap costsLower rework and scrap costsLower rework and scrap costs

Lower warranty costsLower warranty costsLower warranty costsLower warranty costs

Reduced Costs viaReduced Costs viaReduced Costs viaReduced Costs via

Improved responseImproved responseImproved responseImproved response

Flexible pricing Flexible pricing Flexible pricing Flexible pricing

Improved reputationImproved reputationImproved reputationImproved reputation

Sales Gains viaSales Gains viaSales Gains viaSales Gains via

Figure 6.1Figure 6.1Figure 6.1Figure 6.1



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UserUserUserUser----basedbasedbasedbased: better performance, more: better performance, more: better performance, more: better performance, more

features, value, fitness for use,features, value, fitness for use,features, value, fitness for use,features, value, fitness for use,supportsupportsupportsupport

Manufacturing Manufacturing Manufacturing Manufacturing----basedbasedbasedbased: conformance to: conformance to: conformance to: conformance to

standards, making it right the firststandards, making it right the firststandards, making it right the firststandards, making it right the firsttimetimetimetime

ProductProductProductProduct----basedbasedbasedbased: specific and: specific and: specific and: specific andmeasurable attributes of the productmeasurable attributes of the productmeasurable attributes of the productmeasurable attributes of the product



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The totality of features andThe totality of features andThe totality of features andThe totality of features andcharacteristics of a product or servicecharacteristics of a product or servicecharacteristics of a product or servicecharacteristics of a product or service

that bears on its ability to satisfy statedthat bears on its ability to satisfy statedthat bears on its ability to satisfy statedthat bears on its ability to satisfy statedor implied needsor implied needsor implied needsor implied needs

American Society for QualityAmerican Society for QualityAmerican Society for QualityAmerican Society for Quality

Fundamentals of Operations

Management 4e

© The McGraw-Hill Companies, Inc., 2003

6–6

Quality in GoodsQuality in GoodsQuality in GoodsQuality in Goods

o PerformancePerformancePerformancePerformance

o FeaturesFeaturesFeaturesFeatures

o ReliabilityReliabilityReliabilityReliability

o DurabilityDurabilityDurabilityDurability

o ConformanceConformanceConformanceConformance

o ServiceabilityServiceabilityServiceabilityServiceability

o AestheticsAestheticsAestheticsAesthetics

o Perceived qualityPerceived qualityPerceived qualityPerceived quality

Quality in ServicesQuality in ServicesQuality in ServicesQuality in Services

o TangiblesTangiblesTangiblesTangibles

o ReliabilityReliabilityReliabilityReliability

o ResponsivenessResponsivenessResponsivenessResponsiveness

o CompetenceCompetenceCompetenceCompetence

o CourtesyCourtesyCourtesyCourtesy

o CredibilityCredibilityCredibilityCredibility

o SecuritySecuritySecuritySecurity

o AccessAccessAccessAccess

o CommunicationCommunicationCommunicationCommunication

o Understanding the customerUnderstanding the customerUnderstanding the customerUnderstanding the customer


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1.1.1.1. Company reputationCompany reputationCompany reputationCompany reputation

Perception of new productsPerception of new productsPerception of new productsPerception of new products

Employment practicesEmployment practicesEmployment practicesEmployment practices

Supplier relationsSupplier relationsSupplier relationsSupplier relations

2.2.2.2. Product liabilityProduct liabilityProduct liabilityProduct liability

Reduce riskReduce riskReduce riskReduce risk

3.3.3.3. Global implicationsGlobal implicationsGlobal implicationsGlobal implications

Improved ability to competeImproved ability to competeImproved ability to competeImproved ability to compete


Management 4e


6–8

Cost Category

Prevention costs Costs associated with the development ofprograms to prevent defectives fromoccurring in the first place (e.g., training,quality improvement programs)

Appraisal costs Costs associated with the test andinspection of subassemblies and productsafter they have been made.

Failure costs Costs associated with the failure of adefective product.

Internal failure costs —producingdefective products that are identifiedbefore shipment.

External failure costs —producingdefective products that are delivered tothe customer.


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Established in 1988 by the U.S.Established in 1988 by the U.S.Established in 1988 by the U.S.Established in 1988 by the U.S.governmentgovernmentgovernmentgovernment

Designed to promote TQM practicesDesigned to promote TQM practicesDesigned to promote TQM practicesDesigned to promote TQM practices

Recent winners includeRecent winners includeRecent winners includeRecent winners include

Honeywell Federal,Honeywell Federal,Honeywell Federal,Honeywell Federal, Midway USA,Midway USA,Midway USA,Midway USA,AtlantiCareAtlantiCareAtlantiCareAtlantiCare,,,, Heartland Health,Heartland Health,Heartland Health,Heartland Health, Cargill CornCargill CornCargill CornCargill CornMilling, PROMilling, PROMilling, PROMilling, PRO----TEC Coating Co., City of CoralTEC Coating Co., City of CoralTEC Coating Co., City of CoralTEC Coating Co., City of CoralSprings, Premier Inc., Sunny Fresh Foods,Springs, Premier Inc., Sunny Fresh Foods,Springs, Premier Inc., Sunny Fresh Foods,Springs, Premier Inc., Sunny Fresh Foods,Park Place Lexus, Richland CollegePark Place Lexus, Richland CollegePark Place Lexus, Richland CollegePark Place Lexus, Richland College



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ApplicantsApplicantsApplicantsApplicants are evaluated on:are evaluated on:are evaluated on:are evaluated on:

CategoriesCategoriesCategoriesCategories PointsPointsPointsPointsLeadershipLeadershipLeadershipLeadership 120120120120

Strategic PlanningStrategic PlanningStrategic PlanningStrategic Planning 85858585

Customer & Market FocusCustomer & Market FocusCustomer & Market FocusCustomer & Market Focus 85858585

Measurement, Analysis, and KnowledgeMeasurement, Analysis, and KnowledgeMeasurement, Analysis, and KnowledgeMeasurement, Analysis, and Knowledge

ManagementManagementManagementManagement 90909090

Workforce FocusWorkforce FocusWorkforce FocusWorkforce Focus 85858585

Process ManagementProcess ManagementProcess ManagementProcess Management 85858585

ResultsResultsResultsResults 450450450450



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Table 6.1Table 6.1Table 6.1Table 6.1

LeaderLeaderLeaderLeader Philosophy/ContributionPhilosophy/ContributionPhilosophy/ContributionPhilosophy/Contribution

W. Edwards Deming W. Edwards Deming W. Edwards Deming W. Edwards Deming 14 Points for Management14 Points for Management14 Points for Management14 Points for Management

Joseph M.Joseph M.Joseph M.Joseph M. JuranJuranJuranJuran Top managementTop managementTop managementTop managementcommitment, fitness for usecommitment, fitness for usecommitment, fitness for usecommitment, fitness for use

ArmandArmandArmandArmand FeigenbaumFeigenbaumFeigenbaumFeigenbaum Total Quality ControlTotal Quality ControlTotal Quality ControlTotal Quality Control

Philip B. CrosbyPhilip B. CrosbyPhilip B. CrosbyPhilip B. Crosby Quality is Free, zero defectsQuality is Free, zero defectsQuality is Free, zero defectsQuality is Free, zero defects


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Operations managers must deliverOperations managers must deliverOperations managers must deliverOperations managers must deliverhealthy, safe, quality products andhealthy, safe, quality products andhealthy, safe, quality products andhealthy, safe, quality products andservicesservicesservicesservices

Poor quality risks injuries, lawsuits,Poor quality risks injuries, lawsuits,Poor quality risks injuries, lawsuits,Poor quality risks injuries, lawsuits,recalls, and regulationrecalls, and regulationrecalls, and regulationrecalls, and regulation

Organizations are judged by how theyOrganizations are judged by how theyOrganizations are judged by how theyOrganizations are judged by how theyrespond to problemsrespond to problemsrespond to problemsrespond to problems

All stakeholders much be consideredAll stakeholders much be consideredAll stakeholders much be consideredAll stakeholders much be considered


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ISO 9000 series (Europe/EC)ISO 9000 series (Europe/EC)ISO 9000 series (Europe/EC)ISO 9000 series (Europe/EC)

Common quality standards for products sold inCommon quality standards for products sold inCommon quality standards for products sold inCommon quality standards for products sold inEurope (even if made in U.SEurope (even if made in U.SEurope (even if made in U.SEurope (even if made in U.S.). The standard is.). The standard is.). The standard is.). The standard isbeing accepted worldwide.being accepted worldwide.being accepted worldwide.being accepted worldwide.

2008 update places greater emphasis on2008 update places greater emphasis on2008 update places greater emphasis on2008 update places greater emphasis onleadership, andleadership, andleadership, andleadership, and customer requirements andcustomer requirements andcustomer requirements andcustomer requirements and

satisfactionsatisfactionsatisfactionsatisfaction

ISO 14000 series (Europe/EC)ISO 14000 series (Europe/EC)ISO 14000 series (Europe/EC)ISO 14000 series (Europe/EC)



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Core Elements:Core Elements:Core Elements:Core Elements:

Environmental managementEnvironmental managementEnvironmental managementEnvironmental management

Auditing Auditing Auditing Auditing

Performance evaluationPerformance evaluationPerformance evaluationPerformance evaluation

Labeling Labeling Labeling Labeling

Life cycle assessmentLife cycle assessmentLife cycle assessmentLife cycle assessment


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Advantages:Advantages:Advantages:Advantages:

Positive public image and reducedPositive public image and reducedPositive public image and reducedPositive public image and reducedexposure to liabilityexposure to liabilityexposure to liabilityexposure to liability

Systematic approach to pollutionSystematic approach to pollutionSystematic approach to pollutionSystematic approach to pollutionpreventionpreventionpreventionprevention

Compliance with regulatory requirementsCompliance with regulatory requirementsCompliance with regulatory requirementsCompliance with regulatory requirementsand opportunities for competitiveand opportunities for competitiveand opportunities for competitiveand opportunities for competitiveadvantageadvantageadvantageadvantage

Reduction in multiple auditsReduction in multiple auditsReduction in multiple auditsReduction in multiple audits



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An approach forAn approach forAn approach forAn approach for integrating qualityintegrating qualityintegrating qualityintegrating quality atatatat allallallall functionalfunctionalfunctionalfunctional

areas andareas andareas andareas and levelslevelslevelslevels within an organization.within an organization.within an organization.within an organization. EncompassesEncompassesEncompassesEncompasses entire organization, from supplier toentire organization, from supplier toentire organization, from supplier toentire organization, from supplier to

customer.customer.customer.customer.

Stresses a commitment by management to have aStresses a commitment by management to have aStresses a commitment by management to have aStresses a commitment by management to have acontinuing, companywidecontinuing, companywidecontinuing, companywidecontinuing, companywide drive toward excellence indrive toward excellence indrive toward excellence indrive toward excellence in

all aspectsall aspectsall aspectsall aspects of products and services that areof products and services that areof products and services that areof products and services that areimportant to theimportant to theimportant to theimportant to the customer.customer.customer.customer.

Focuses onFocuses onFocuses onFocuses on producing high quality goods andproducing high quality goods andproducing high quality goods andproducing high quality goods andservices.services.services.services.



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1. Create consistency of purpose

2. Lead to promote change

3. Build quality into the product; stopdepending on inspections

4. Build long-term relationships based on

performance instead of awardingbusiness on price

5. Continuously improve product, quality,and service


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6. Start training

7. Emphasize leadership

8. Drive out fear

9. Break down barriers betweendepartments

10. Stop haranguing workers

11. Support, help, and improve


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12. Remove barriers to pride in work

13. Institute education and self-improvement

14. Put everyone to work on thetransformation


Management 4e


6–20

LeadershipLeadershipLeadershipLeadership

o Top management vision, planning and supportTop management vision, planning and supportTop management vision, planning and supportTop management vision, planning and support

Employee involvementEmployee involvementEmployee involvementEmployee involvement

o All employees assume responsibility for inspecting theAll employees assume responsibility for inspecting theAll employees assume responsibility for inspecting theAll employees assume responsibility for inspecting the

quality of their work.quality of their work.quality of their work.quality of their work.

Product/Process ExcellenceProduct/Process ExcellenceProduct/Process ExcellenceProduct/Process Excellence

o Involves product design quality and monitoring theInvolves product design quality and monitoring theInvolves product design quality and monitoring theInvolves product design quality and monitoring the

process for continuous improvement.process for continuous improvement.process for continuous improvement.process for continuous improvement.

• PokaPokaPokaPoka----yokes are devices that preventyokes are devices that preventyokes are devices that preventyokes are devices that prevent defect productsdefect productsdefect productsdefect productsfrom being produced.from being produced.from being produced.from being produced..


Management 4e


6–21

Continuous ImprovementContinuous ImprovementContinuous ImprovementContinuous Improvement

o A concept thatA concept thatA concept thatA concept that recognizesrecognizesrecognizesrecognizes that quality improvement is athat quality improvement is athat quality improvement is athat quality improvement is a journey with no end journey with no end journey with no end journey with no end and that there isand that there isand that there isand that there is a need for continuallya need for continuallya need for continuallya need for continuallylooking for new approacheslooking for new approacheslooking for new approacheslooking for new approaches for improving quality.for improving quality.for improving quality.for improving quality.

Customer Focus on “Fitness for Use”Customer Focus on “Fitness for Use”Customer Focus on “Fitness for Use”Customer Focus on “Fitness for Use”

o Design qualityDesign qualityDesign qualityDesign quality

• Specific characteristics of a product that determine itsSpecific characteristics of a product that determine itsSpecific characteristics of a product that determine itsSpecific characteristics of a product that determine itsvalue in the marketplace.value in the marketplace.value in the marketplace.value in the marketplace.

o Conformance qualityConformance qualityConformance qualityConformance quality

• The degree to which a product meets its designThe degree to which a product meets its designThe degree to which a product meets its designThe degree to which a product meets its designspecifications.specifications.specifications.specifications.


Management 4e


6–22

Successful Implementation of TQMSuccessful Implementation of TQMSuccessful Implementation of TQMSuccessful Implementation of TQM

o Requires total integration of TQM into dayRequires total integration of TQM into dayRequires total integration of TQM into dayRequires total integration of TQM into day----totototo----daydaydaydayoperations.operations.operations.operations.

Causes of TQM Implementation FailuresCauses of TQM Implementation FailuresCauses of TQM Implementation FailuresCauses of TQM Implementation Failures

o Lack of focus on strategic planning and coreLack of focus on strategic planning and coreLack of focus on strategic planning and coreLack of focus on strategic planning and core

competenciescompetenciescompetenciescompetencies

o Obsolete, outdated organizational cultures.Obsolete, outdated organizational cultures.Obsolete, outdated organizational cultures.Obsolete, outdated organizational cultures.


Management 4e


6–23

Lack of a companyLack of a companyLack of a companyLack of a company----wide definition of quality.wide definition of quality.wide definition of quality.wide definition of quality.

Lack of a formalized strategic plan for change.Lack of a formalized strategic plan for change.Lack of a formalized strategic plan for change.Lack of a formalized strategic plan for change.

Lack of a customer focus.Lack of a customer focus.Lack of a customer focus.Lack of a customer focus.

Poor interPoor interPoor interPoor inter----organizational communication.organizational communication.organizational communication.organizational communication.

Lack of real employee empowerment.Lack of real employee empowerment.Lack of real employee empowerment.Lack of real employee empowerment.

Lack of employee trust in senior management.Lack of employee trust in senior management.Lack of employee trust in senior management.Lack of employee trust in senior management.

View of the quality program as a quick fix.View of the quality program as a quick fix.View of the quality program as a quick fix.View of the quality program as a quick fix.

Drive for shortDrive for shortDrive for shortDrive for short----term financial results.term financial results.term financial results.term financial results.

Politics and turf issues.Politics and turf issues.Politics and turf issues.Politics and turf issues.


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1.1.1.1. ContinuousContinuousContinuousContinuous improvementimprovementimprovementimprovement(Kaizen)(Kaizen)(Kaizen)(Kaizen)

2.2.2.2. Six SigmaSix SigmaSix SigmaSix Sigma

3.3.3.3. Employee empowermentEmployee empowermentEmployee empowermentEmployee empowerment

4.4.4.4. Benchmarking Benchmarking Benchmarking Benchmarking

5.5.5.5. JustJustJustJust----inininin----time (JIT)time (JIT)time (JIT)time (JIT)

6.6.6.6. Taguchi conceptsTaguchi conceptsTaguchi conceptsTaguchi concepts

7.7.7.7. Knowledge of TQM toolsKnowledge of TQM toolsKnowledge of TQM toolsKnowledge of TQM tools


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RepresentsRepresentsRepresentsRepresents continual improvementcontinual improvementcontinual improvementcontinual improvement of allof allof allof allprocesses (processes (processes (processes (never ending processnever ending processnever ending processnever ending process))))

Involves all operations and work centersInvolves all operations and work centersInvolves all operations and work centersInvolves all operations and work centersincluding suppliers and customersincluding suppliers and customersincluding suppliers and customersincluding suppliers and customers

People, Equipment, Materials, ProceduresPeople, Equipment, Materials, ProceduresPeople, Equipment, Materials, ProceduresPeople, Equipment, Materials, Procedures

TheTheTheThe end goal is perfectionend goal is perfectionend goal is perfectionend goal is perfection, which is never, which is never, which is never, which is never

achieved but always soughtachieved but always soughtachieved but always soughtachieved but always sought



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4. Act4. Act4. Act4. Act

Implement theImplement theImplement theImplement theplan documentplan documentplan documentplan document

2. Do2. Do2. Do2. DoTest the planTest the planTest the planTest the plan

3. Check3. Check3. Check3. CheckIs the planIs the planIs the planIs the planworking?working?working?working?

1.1.1.1.PlanPlanPlanPlan

Identify the patternIdentify the patternIdentify the patternIdentify the patternand make a planand make a planand make a planand make a plan



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Two meaningsTwo meaningsTwo meaningsTwo meanings

Statistical definition of a process that isStatistical definition of a process that isStatistical definition of a process that isStatistical definition of a process that is99.9997% capable, 3.4 defects per99.9997% capable, 3.4 defects per99.9997% capable, 3.4 defects per99.9997% capable, 3.4 defects permillion opportunities (DPMO)million opportunities (DPMO)million opportunities (DPMO)million opportunities (DPMO)

A program designed to reduce defects,A program designed to reduce defects,A program designed to reduce defects,A program designed to reduce defects,lower costs, and improve customerlower costs, and improve customerlower costs, and improve customerlower costs, and improve customersatisfactionsatisfactionsatisfactionsatisfaction



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Two meaningsTwo meaningsTwo meaningsTwo meanings

Statistical definition of a process that isStatistical definition of a process that isStatistical definition of a process that isStatistical definition of a process that is99.9997% capable, 3.4 defects per99.9997% capable, 3.4 defects per99.9997% capable, 3.4 defects per99.9997% capable, 3.4 defects permillion opportunities (DPMO)million opportunities (DPMO)million opportunities (DPMO)million opportunities (DPMO)

A program designed to reduce defects,A program designed to reduce defects,A program designed to reduce defects,A program designed to reduce defects,lower costs, and improve customerlower costs, and improve customerlower costs, and improve customerlower costs, and improve customersatisfactionsatisfactionsatisfactionsatisfaction

MeanMeanMeanMean

Lower limitsLower limitsLower limitsLower limits Upper limitsUpper limitsUpper limitsUpper limits

3.4 defects/million3.4 defects/million3.4 defects/million3.4 defects/million

±6666σσσσ

2,700 defects/million2,700 defects/million2,700 defects/million2,700 defects/million

±3333σσσσ




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Originally developed by Motorola,Originally developed by Motorola,Originally developed by Motorola,Originally developed by Motorola,adopted and enhanced by Honeywelladopted and enhanced by Honeywelladopted and enhanced by Honeywelladopted and enhanced by Honeywell

and GEand GEand GEand GE

Highly structured approach to processHighly structured approach to processHighly structured approach to processHighly structured approach to process

improvementimprovementimprovementimprovement

A strategyA strategyA strategyA strategy

A disciplineA disciplineA disciplineA discipline ---- DMAICDMAICDMAICDMAIC 6σσσσ6σσσσ


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1.1.1.1. Define critical outputsDefine critical outputsDefine critical outputsDefine critical outputsand identify gaps forand identify gaps forand identify gaps forand identify gaps forimprovementimprovementimprovementimprovement

2.2.2.2. Measure the work andMeasure the work andMeasure the work andMeasure the work andcollect process datacollect process datacollect process datacollect process data

3.3.3.3. Analyze the dataAnalyze the dataAnalyze the dataAnalyze the data

4.4.4.4. Improve the processImprove the processImprove the processImprove the process

5.5.5.5. Control the new process to makeControl the new process to makeControl the new process to makeControl the new process to makesure new performance issure new performance issure new performance issure new performance ismaintainedmaintainedmaintainedmaintained

DMAIC ApproachDMAIC ApproachDMAIC ApproachDMAIC Approach


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Emphasize defects per million opportunities asEmphasize defects per million opportunities asEmphasize defects per million opportunities asEmphasize defects per million opportunities asa standard metrica standard metrica standard metrica standard metric

Provide extensive training Provide extensive training Provide extensive training Provide extensive training

Focus on corporate sponsor supportFocus on corporate sponsor supportFocus on corporate sponsor supportFocus on corporate sponsor support(Champions)(Champions)(Champions)(Champions)

Create qualified process improvement expertsCreate qualified process improvement expertsCreate qualified process improvement expertsCreate qualified process improvement experts(Black Belts, Green Belts, etc.)(Black Belts, Green Belts, etc.)(Black Belts, Green Belts, etc.)(Black Belts, Green Belts, etc.)

Set stretch objectivesSet stretch objectivesSet stretch objectivesSet stretch objectives

This cannot be accomplished without a major commitment from topThis cannot be accomplished without a major commitment from topThis cannot be accomplished without a major commitment from topThis cannot be accomplished without a major commitment from toplevel managementlevel managementlevel managementlevel management



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Getting employees involved in product andGetting employees involved in product andGetting employees involved in product andGetting employees involved in product andprocess improvementsprocess improvementsprocess improvementsprocess improvements

85% of quality problems are due85% of quality problems are due85% of quality problems are due85% of quality problems are due

to process and materialto process and materialto process and materialto process and material

TechniquesTechniquesTechniquesTechniques

Build communication networksBuild communication networksBuild communication networksBuild communication networks

that include employeesthat include employeesthat include employeesthat include employees Develop open, supportive supervisorsDevelop open, supportive supervisorsDevelop open, supportive supervisorsDevelop open, supportive supervisors

Move responsibility to employeesMove responsibility to employeesMove responsibility to employeesMove responsibility to employees

Build a highBuild a highBuild a highBuild a high----morale organizationmorale organizationmorale organizationmorale organization

Create formal team structuresCreate formal team structuresCreate formal team structuresCreate formal team structures


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Group of employees who meetGroup of employees who meetGroup of employees who meetGroup of employees who meetregularly to solve problemsregularly to solve problemsregularly to solve problemsregularly to solve problems

Trained in planning, problem solving,Trained in planning, problem solving,Trained in planning, problem solving,Trained in planning, problem solving,and statistical methodsand statistical methodsand statistical methodsand statistical methods

Often led by a facilitatorOften led by a facilitatorOften led by a facilitatorOften led by a facilitator

Very effective when done properlyVery effective when done properlyVery effective when done properlyVery effective when done properly



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Selecting best practices to use as a standardSelecting best practices to use as a standardSelecting best practices to use as a standardSelecting best practices to use as a standardfor performancefor performancefor performancefor performance

1.1.1.1. Determine what toDetermine what toDetermine what toDetermine what tobenchmarkbenchmarkbenchmarkbenchmark

2.2.2.2. Form a benchmark teamForm a benchmark teamForm a benchmark teamForm a benchmark team

3.3.3.3. Identify benchmarking partnersIdentify benchmarking partnersIdentify benchmarking partnersIdentify benchmarking partners

4.4.4.4. Collect and analyze benchmarkingCollect and analyze benchmarkingCollect and analyze benchmarkingCollect and analyze benchmarkinginformationinformationinformationinformation

5.5.5.5. Take action to match or exceed theTake action to match or exceed theTake action to match or exceed theTake action to match or exceed thebenchmarkbenchmarkbenchmarkbenchmark



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Best Practice Justification

Make it easy for clientsto complain

It is free market research

Respond quickly tocomplaints

It adds customers and loyalty

Resolve complaints on

first contact

It reduces cost

Use computers tomanage complaints

Discover trends, share them, andalign your services

Recruit the best forcustomer service jobs

It should be part of formal trainingand career advancement



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Relationship to quality:Relationship to quality:Relationship to quality:Relationship to quality:

JIT cuts the cost of qualityJIT cuts the cost of qualityJIT cuts the cost of qualityJIT cuts the cost of quality

JIT improves qualityJIT improves qualityJIT improves qualityJIT improves quality

Better quality means less inventoryBetter quality means less inventoryBetter quality means less inventoryBetter quality means less inventory

and better, easierand better, easierand better, easierand better, easier----totototo----employ JITemploy JITemploy JITemploy JIT

systemsystemsystemsystem


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‘Pull’ system of production scheduling‘Pull’ system of production scheduling‘Pull’ system of production scheduling‘Pull’ system of production schedulingincluding supply managementincluding supply managementincluding supply managementincluding supply management

Production only when signaledProduction only when signaledProduction only when signaledProduction only when signaled

Allows reduced inventory levelsAllows reduced inventory levelsAllows reduced inventory levelsAllows reduced inventory levels

Inventory costs money and hides process andInventory costs money and hides process andInventory costs money and hides process andInventory costs money and hides process andmaterial problemsmaterial problemsmaterial problemsmaterial problems

Encourages improved process and productEncourages improved process and productEncourages improved process and productEncourages improved process and productqualityqualityqualityquality



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ScrapScrapScrapScrapUnreliableUnreliableUnreliableUnreliableVendorsVendorsVendorsVendors

CapacityCapacityCapacityCapacityImbalancesImbalancesImbalancesImbalances

Work in processWork in processWork in processWork in processinventory levelinventory levelinventory levelinventory level

(hides problems)(hides problems)(hides problems)(hides problems)


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Reducing inventory revealsReducing inventory revealsReducing inventory revealsReducing inventory revealsproblems so they can be solvedproblems so they can be solvedproblems so they can be solvedproblems so they can be solved

ScrapScrapScrapScrapUnreliableUnreliableUnreliableUnreliableVendorsVendorsVendorsVendors

CapacityCapacityCapacityCapacityImbalancesImbalancesImbalancesImbalances



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Engineering and experimental designEngineering and experimental designEngineering and experimental designEngineering and experimental design

methods to improve product and processmethods to improve product and processmethods to improve product and processmethods to improve product and processdesigndesigndesigndesign

Identify key component and processIdentify key component and processIdentify key component and processIdentify key component and processvariables affecting product variationvariables affecting product variationvariables affecting product variationvariables affecting product variation

Taguchi ConceptsTaguchi ConceptsTaguchi ConceptsTaguchi Concepts

Quality robustnessQuality robustnessQuality robustnessQuality robustness

Quality loss functionQuality loss functionQuality loss functionQuality loss function

TargetTargetTargetTarget----oriented qualityoriented qualityoriented qualityoriented quality

© 2011 Pearson Education, Inc. publishing as Prentice

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Ability to produce productsAbility to produce productsAbility to produce productsAbility to produce products uniformlyuniformlyuniformlyuniformly ininininadverse manufacturing andadverse manufacturing andadverse manufacturing andadverse manufacturing and

environmental conditionsenvironmental conditionsenvironmental conditionsenvironmental conditions

Remove the effects of adverse conditionsRemove the effects of adverse conditionsRemove the effects of adverse conditionsRemove the effects of adverse conditions

Small variations in materials and processSmall variations in materials and processSmall variations in materials and processSmall variations in materials and processdo not destroy product qualitydo not destroy product qualitydo not destroy product qualitydo not destroy product quality


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Shows that costs increase as theShows that costs increase as theShows that costs increase as theShows that costs increase as theproduct moves away from what theproduct moves away from what theproduct moves away from what theproduct moves away from what the

customer wantscustomer wantscustomer wantscustomer wants

Costs include customerCosts include customerCosts include customerCosts include customer

dissatisfaction, warrantydissatisfaction, warrantydissatisfaction, warrantydissatisfaction, warrantyand service, internaland service, internaland service, internaland service, internal

scrap and repair, and costs to societyscrap and repair, and costs to societyscrap and repair, and costs to societyscrap and repair, and costs to society

Traditional conformance specificationsTraditional conformance specificationsTraditional conformance specificationsTraditional conformance specifications

are too simplisticare too simplisticare too simplisticare too simplistic


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UnacceptableUnacceptableUnacceptableUnacceptable

PoorPoorPoorPoor

GoodGoodGoodGood

BestBestBestBest

FairFairFairFair

High lossHigh lossHigh lossHigh loss

Loss (toLoss (toLoss (toLoss (to

producingproducingproducingproducingorganization,organization,organization,organization,

customer, andcustomer, andcustomer, andcustomer, andsociety)society)society)society)

Low lossLow lossLow lossLow loss

FrequencyFrequencyFrequencyFrequency

LowerLowerLowerLower TargetTargetTargetTarget UpperUpperUpperUpper

SpecificationSpecificationSpecificationSpecification

TargetTargetTargetTarget----oriented qualityoriented qualityoriented qualityoriented qualityyields more product inyields more product inyields more product inyields more product in

the “best” categorythe “best” categorythe “best” categorythe “best” category

TargetTargetTargetTarget----oriented qualityoriented qualityoriented qualityoriented qualitybrings product toward thebrings product toward thebrings product toward thebrings product toward the

target valuetarget valuetarget valuetarget value

ConformanceConformanceConformanceConformance----orientedorientedorientedoriented

quality keeps productsquality keeps productsquality keeps productsquality keeps productswithin 3 standardwithin 3 standardwithin 3 standardwithin 3 standard

deviationsdeviationsdeviationsdeviations


LLLL ==== DDDD2222C CC C

wherewherewherewhere

LLLL ==== loss to societyloss to societyloss to societyloss to society

DDDD ==== distance from targetdistance from targetdistance from targetdistance from targetvaluevaluevaluevalue

C CC C ==== cost of deviationcost of deviationcost of deviationcost of deviation



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Tools for Generating IdeasTools for Generating IdeasTools for Generating IdeasTools for Generating Ideas

Check sheetsCheck sheetsCheck sheetsCheck sheets

Scatter diagramsScatter diagramsScatter diagramsScatter diagrams

CauseCauseCauseCause----andandandand----effect diagramseffect diagramseffect diagramseffect diagrams

Tools to Organize the DataTools to Organize the DataTools to Organize the DataTools to Organize the Data Pareto chartsPareto chartsPareto chartsPareto charts

FlowchartsFlowchartsFlowchartsFlowcharts


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Tools for Identifying ProblemsTools for Identifying ProblemsTools for Identifying ProblemsTools for Identifying Problems

HistogramHistogramHistogramHistogram

Statistical process control chartStatistical process control chartStatistical process control chartStatistical process control chart



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/ // /

HourHourHourHour

DefectDefectDefectDefect 1111 2222 3333 4444 5555 6666 7777 8888

AAAA

BBBB

CCCC

/ // /

/ // /

// // // //

/ // /

(a)(a)(a)(a) Check Sheet: An organized method of recording dataCheck Sheet: An organized method of recording dataCheck Sheet: An organized method of recording dataCheck Sheet: An organized method of recording data




Hall

(b)(b)(b)(b) Scatter Diagram: A graph of the value of one variable vs.Scatter Diagram: A graph of the value of one variable vs.Scatter Diagram: A graph of the value of one variable vs.Scatter Diagram: A graph of the value of one variable vs.another variableanother variableanother variableanother variable

AbsenteeismAbsenteeismAbsenteeismAbsenteeism

P r o d u

c t i v i t y

P r o d u

c t i v i t y

P r o d u

c t i v i t y

P r o d u

c t i v i t y



Hall

(c)(c)(c)(c) CauseCauseCauseCause----andandandand----Effect Diagram: A tool that i dentifies processEffect Diagram: A tool that identifies processEffect Diagram: A tool that identifies processEffect Diagram: A tool that identifies processelements (causes) that might effect an outcomeelements (causes) that might effect an outcomeelements (causes) that might effect an outcomeelements (causes) that might effect an outcome


CauseCauseCauseCause

MaterialsMaterialsMaterialsMaterials MethodsMethodsMethodsMethods

ManpowerManpowerManpowerManpower MachineryMachineryMachineryMachinery

EffectEffectEffectEffect


9/15



Hall

MaterialMaterialMaterialMaterial(ball)(ball)(ball)(ball)

MethodMethodMethodMethod(shooting process)(shooting process)(shooting process)(shooting process)

MachineMachineMachineMachine(hoop &(hoop &(hoop &(hoop &

backboard)backboard)backboard)backboard)

ManpowerManpowerManpowerManpower(shooter)(shooter)(shooter)(shooter)

MissedMissedMissedMissedfreefreefreefree----throwsthrowsthrowsthrows


Rim alignmentRim alignmentRim alignmentRim alignment

Rim sizeRim sizeRim sizeRim size

BackboardBackboardBackboardBackboardstabilitystabilitystabilitystability

Rim heightRim heightRim heightRim height

FollowFollowFollowFollow----throughthroughthroughthrough

Hand positionHand positionHand positionHand position

Aiming pointAiming pointAiming pointAiming point

Bend kneesBend kneesBend kneesBend knees

BalanceBalanceBalanceBalance

Size of ballSize of ballSize of ballSize of ball

LopsidednessLopsidednessLopsidednessLopsidedness

Grain/FeelGrain/FeelGrain/FeelGrain/Feel(grip)(grip)(grip)(grip)

Air pressureAir pressureAir pressureAir pressure

Training Training Training Training

Conditioning Conditioning Conditioning Conditioning MotivationMotivationMotivationMotivation

ConcentrationConcentrationConcentrationConcentration

ConsistencyConsistencyConsistencyConsistency

To Accompany Krajewski &

Ritzman Operations

Management: Strategy and

Analysis, Seventh Edition ©

2004 Prentice Hall, Inc. All

Passenger processing at gate

Late cabin cleaners

Unavailable cockpit crew

Late cabin crew

Personnel

Aircraft late to gate

Mechanical failures

Equipment

Procedures

Waiting for late passengers

Weight/balance sheet late

Poor announcement of departures

Delayed check-in procedure

Delayed

flight

departures

Materials

Late food service

Late fuel

Late baggage to aircraft

Contractor not provided

updated schedule

Figure 4.11

Weather

Air traffic delays

Other

Source: Adapted fromD. Daryl Wyckoff, “NewTools for Achieving Service Quality.” The CornellHotel and RestaurantAdministration Quarterly, November 1984, pg. 89. © 1984 Cornell H.R.A. Quarterly. Used by permission. Allrights reserved.


Hall

(d)(d)(d)(d) Pareto Chart: A graph to identify and plot problems or defects inPareto Chart: A graph to identify and plot problems or defects inPareto Chart: A graph to i dentify and plot problems or defects inPareto Chart: A graph to identify and plot problems or defects indescending order of frequencydescending order of frequencydescending order of frequencydescending order of frequency


F r e q u e n c y

F r e q u e n c y

F r e q u e n c y

F r e q u e n c y

P e r c e n t

P e r c e n t

P e r c e n t

P e r c e n t

AAAA BBBB CCCC DDDD EEEE



Hall

Number ofNumber ofNumber ofNumber of

occurrencesoccurrencesoccurrencesoccurrences

Room svcRoom svcRoom svcRoom svc CheckCheckCheckCheck----inininin Pool h oursPool hoursPool hoursPoo l hours Mi ni barMinibarMinibarMinibar Misc.Misc.Misc.Misc.72%72%72%72% 16%16%16%16% 5%5%5%5% 4%4%4%4% 3%3%3%3%

12121212

4444 3333 2222

54545454

–––– 100100100100

–––– 93939393–––– 88888888

–––– 72727272

70707070 ––––

60606060 ––––

50505050 ––––

40404040 ––––

30303030 ––––

20202020 ––––

10101010 ––––

0000 ––––

F r e q u e n c y ( n u m b e r )




Causes and percent of the totalCauses and percent of the totalCauses and percent of the totalCauses and percent of the total

C u m u l a t i v e p e r c e n t




Data for OctoberData for OctoberData for OctoberData for October



Hall

(e)(e)(e)(e) Flowchart (Process Diagram): A chart that describes the steps in aFlowchart (Process Diagram): A chart t hat describes the steps in aFlowchart (Process Diagram): A chart t hat describes the steps in aFlowchart (Process Diagram): A chart t hat describes the steps in aprocessprocessprocessprocess



Hall

MRI FlowchartMRI FlowchartMRI FlowchartMRI Flowchart

1. Physician schedules MRI2. Patient taken to MRI3. Patient signs in4. Patient is prepped5. Technician carries out MRI6. Technician inspects film

7. If unsatisfactory, repeat8. Patient taken back to room9. MRI read by radiologist10. MRI report transferred to

physician11. Patient and physician discuss

11111111

10101010

20%20%20%20%

9999

888880%80%80%80%

1111 2222 3333 4444 5555 6666 7777


10/15


11/15



Hall

Many problemsMany problemsMany problemsMany problems

Worker fatigueWorker fatigueWorker fatigueWorker fatigue

Measurement errorMeasurement errorMeasurement errorMeasurement error

Process variabilityProcess variabilityProcess variabilityProcess variability

Cannot inspect quality into a productCannot inspect quality into a productCannot inspect quality into a productCannot inspect quality into a product

Robust design, empoweredRobust design, empoweredRobust design, empoweredRobust design, empoweredemployees, and sound processes areemployees, and sound processes areemployees, and sound processes areemployees, and sound processes are

better solutionsbetter solutionsbetter solutionsbetter solutions



Hall

The Operations Manager mustThe Operations Manager mustThe Operations Manager mustThe Operations Manager mustrecognize:recognize:recognize:recognize:

1.1.1.1. The tangible component of servicesThe tangible component of servicesThe tangible component of servicesThe tangible component of servicesis importantis importantis importantis important

2.2.2.2. The service process is importantThe service process is importantThe service process is importantThe service process is important

3.3.3.3. The service is judged against theThe service is judged against theThe service is judged against theThe service is judged against thecustomer’s expectationscustomer’s expectationscustomer’s expectationscustomer’s expectations

4.4.4.4. Exceptions will occurExceptions will occurExceptions will occurExceptions will occur


Hall



Hall

Reliability Consistency of performance and dependability

Responsiveness Willingness or readiness of employeesCompetence Required skills and knowledge

Access Approachability and ease of contact

Courtesy Politeness, respect, consideration, friendliness

Communicat ion Keeping customers informed

Credibility Trustworthiness, believability, honesty

Security Freedom from danger, risk, or doubt

Understanding/knowing the customer

Understand the customer’s needs

Tangibles Physical evidence of the service




Hall

Managers should have a plan for when

services fail

Marriott’s LEARN routine

Listen

Empathize

Apologize

React

Notify


Hall

Also known as source controlAlso known as source controlAlso known as source controlAlso known as source control

The next step in the process is yourThe next step in the process is yourThe next step in the process is yourThe next step in the process is your

customercustomercustomercustomer

Ensure perfect productEnsure perfect productEnsure perfect productEnsure perfect productto your customerto your customerto your customerto your customer

PokaPokaPokaPoka----yoke is the concept of foolproof devices or techniques designedyoke is the c oncept of foolproof devices or techniques designedyoke is the concept of foolproof devices or techniques designedyoke is the c oncept of foolproof devices or techniques designedto pass only acceptable productto pass only acceptable productto pass only acceptable productto pass only acceptable product


12/15



Hall

OrganizationWhat is

Inspected Standard

Jones Law Office Receptionistperformance

Billing

Attorney

Is phone answered by thesecond ring

Accurate, timely, andcorrect format

Promptness in returningcalls




Hall

OrganizationWhat is

InspectedStandard

Hard Rock Hotel Receptiondesk

Doorman

Room

Minibar

Use customer’s name

Greet guest in less than 30seconds

All lights working, spotlessbathroom

Restocked and chargesaccurately posted to bill



Hall

OrganizationWhat is

InspectedStandard

Arnold PalmerHospital

Billing

Pharmacy

Lab

Nurses

Admissions

Accurate, timely, andcorrect format

Prescription accuracy,inventory accuracy

Audit for lab-test accuracy

Charts immediatelyupdated

Data entered correctly andcompletely




Hall

OrganizationWhat is

Inspected Standard

Olive GardenRestaurant

Busboy

Busboy

Waiter

Serves water and breadwithin 1 minute

Clears all entrée items andcrumbs prior to dessert

Knows and suggestspecials, desserts




Hall

OrganizationWhat is

InspectedStandard

NordstromDepartmentStore

Display areas

Stockrooms

Salesclerks

Attractive, well-organized,stocked, good lighting

Rotation of goods,organized, clean

Neat, courteous, veryknowledgeable


JapaneseTerm

EnglishEquivalent

Meaning in JapaneseContext

Seiri TidinessThrow away all rubbish and unrelatedmaterials in the workplace

Seiton OrderlinessSet everything in proper place forquick retrieval and storage

Seiso CleanlinessClean the workplace; everyoneshould be a janitor

Seiketsu StandardizationStandardize the way of maintainingcleanliness

Shitsuke DisciplinePractice 'Five S' daily - make it a wayof life; this also means 'commitment'


13/15


14/15


Ritzman Operations




Checklists

Figure 4.12

Headliner Defects

Defect type Tally Total

A. Tears in fabric /

B. Discolored fabric

C. Broken fiber board //

D. Ragged edges /

Total


Ritzman Operations




Checklists

Headliner Defects

Defect type Tally Total

A. Tears in fabric //// 4

B. Discolored fabric /// 3

C. Broken fiber board //// //// //// ////

//// //// //// / 36

D. Ragged edges //// // 7

Total 50

Figure 4.12


RitzmanOperationsManagement: Strategy and



C

DA B

Pareto Chart

100

80

60

40

20

0

C u m u l a t i v e p e r c e n t a g e

N u m b e r o f d e f e c t s

50

40

30

20

10

0

Defect typeFigure 4.12


Ritzman Operations




Cause-and-Effect Diagram

Figure 4.12

Out of specification

Not available

Materials

Humidity

Schedule changes

Other

Machine maintenance

Machine speed

Wrong setup

Process

Training

Absenteeism

Communication

People

Broken

fiber board


Ritzman Operations




Bar Chart 20

15

10

5

0 N u m b e r o f b r o k e n f i b e r b o a r d s

First Second Third

ShiftFigure 4.12


RitzmanOperationsManagement: Strategy and



Figure 4.13

(a) Flowchart for one-teller bank

(b) Flowchart for two-teller bank

Entrance Buffer Work Station Buffer

Door Line Teller Served Customers

Work Station

Teller 1

Entrance Buffer Buffer

Door Line Served Customers

Work Station

Teller 2


15/15


Ritzman Operations




Figure 4.14

Element Element Statistics Overall Types Names Means

Entrance(s) Door Service level 0.90

Buffer(s) Line Mean inventory 4.47

Mean cycle time 11.04

quality management & tqm-modified

Documents