To accompany Krajewski & Ritzman Operations Management: Strategy and Analysis, Fourth Edition 1996 Addison-Wesley Publishing Company, Inc. All rights reserved.

Total Quality Total Quality ManagementManagement

A. A. ElimamA. A. Elimam

To accompany Krajewski & Ritzman Operations Management: Strategy and Analysis, Fourth Edition 1996 Addison-Wesley Publishing Company, Inc. All rights reserved.

Definitions of QualityDefinitions of Quality Conformance to Specifications Value Fitness for Use Support Psychological Impressions

To accompany Krajewski & Ritzman Operations Management: Strategy and Analysis, Fourth Edition 1996 Addison-Wesley Publishing Company, Inc. All rights reserved.

How Quality Assurance Evolved• 1800’s: skilled craftsmen• Industrial Revolution: factory System• 100% Inspections• 1900’s: Larger Organizations• 1920’s Bell Lab Statistical Quality Control

– Shewhart Control Charts (1924)– Dodge & Romig Acceptance Sampling (1930)

• Separate QC department & Manager• World War II: Growing Concern for Quality• Quality Awards in Japan, USA & other countries

To accompany Krajewski & Ritzman Operations Management: Strategy and Analysis, Fourth Edition 1996 Addison-Wesley Publishing Company, Inc. All rights reserved.

PlanPlan

DoDo

CheckCheck

ActAct

DemingDemingWheelWheel

To accompany Krajewski & Ritzman Operations Management: Strategy and Analysis, Fourth Edition 1996 Addison-Wesley Publishing Company, Inc. All rights reserved.

ContinuousContinuousImprovementImprovement

ProjectsProjects

Current Reduce Reduce Reducesituation material repair inspection

handling time timetime

Continuous improvement

T

otal

tim

e

Mat

eria

lM

achi

ning

In

spec

tion

R

epai

r h

andl

ing

To accompany Krajewski & Ritzman Operations Management: Strategy and Analysis, Fourth Edition 1996 Addison-Wesley Publishing Company, Inc. All rights reserved.

Costs of Detecting DefectsCosts of Detecting DefectsC

ost o

f det

ectio

n (d

olla

rs)

Process Final testing CustomerWhen defect is detected

To accompany Krajewski & Ritzman Operations Management: Strategy and Analysis, Fourth Edition 1996 Addison-Wesley Publishing Company, Inc. All rights reserved.

QUALITY IMPROVEMENT TOOLS

• CHECK OR TALLY SHEET

• CAUSE-AND-EFFECT DIAGRAM

• STATISTICAL TOOLS: HISTOGRAMS, CONTROL CHARTS

To accompany Krajewski & Ritzman Operations Management: Strategy and Analysis, Fourth Edition 1996 Addison-Wesley Publishing Company, Inc. All rights reserved.

Cause-and-EffectCause-and-EffectDiagramsDiagrams

EffectEffect

PersonnelPersonnelMachinesMachines

ProcessProcessMaterialsMaterials

To accompany Krajewski & Ritzman Operations Management: Strategy and Analysis, Fourth Edition 1996 Addison-Wesley Publishing Company, Inc. All rights reserved.

King Tut AirlinesKing Tut AirlinesPassenger processing at gate

Late cabin cleaners

Unavailable cockpit crew

Late cabin crew

Personnel

Weather

Air traffic delays

Other

Aircraft late to gate

Mechanical failures

Equipment

Materials Procedures

Waiting for late passengers

Weight/balance sheet late

Poor announcement of departures

Delayed check-in procedure

Delayed flight departures

Late food service

Late fuel

Late baggage to aircraft

To accompany Krajewski & Ritzman Operations Management: Strategy and Analysis, Fourth Edition 1996 Addison-Wesley Publishing Company, Inc. All rights reserved.

MINA Fiber Board Co.MINA Fiber Board Co.ChecklistsChecklists

Headliner Defects Defect type Tally Total

A. Tears in fabric //// 4B. Discolored fabric /// 3C. Broken fiber board //// //// //// ////

//// //// //// / 36D. Ragged edges //// // 7

Total 50

To accompany Krajewski & Ritzman Operations Management: Strategy and Analysis, Fourth Edition 1996 Addison-Wesley Publishing Company, Inc. All rights reserved.

MINA Fiber Board Co.MINA Fiber Board Co.Pareto ChartPareto Chart

Num

ber o

f def

ects

100

80

60

40

20

0

50

40

30

20

10

0

Cum

ulat

ive

perc

enta

ge

Defect type

C

DA B

To accompany Krajewski & Ritzman Operations Management: Strategy and Analysis, Fourth Edition 1996 Addison-Wesley Publishing Company, Inc. All rights reserved.

A Pareto ChartPe

rcen

t def

ectiv

e

Causes of poor quality

Machin

e cali

brati

ons

Defecti

ve pa

rts

Wro

ng di

mensio

ns

Poor D

esign

Opera

tor er

rors

Defecti

ve m

ateria

ls

Sur

face a

bras

ions

0

10

20

30

40

50

60

70 (64)

(13)(10)

(6) (3) (2) (2)

To accompany Krajewski & Ritzman Operations Management: Strategy and Analysis, Fourth Edition 1996 Addison-Wesley Publishing Company, Inc. All rights reserved.

MINA Fiber Board Co.MINA Fiber Board Co.Cause-and-Effect DiagramCause-and-Effect Diagram

Out of specification Not available

Training Absenteeism Communication

HumiditySchedule changes

Machine maintenance Machine speedWrong setup

Broken fiber

board

Process

People

Other

Materials

To accompany Krajewski & Ritzman Operations Management: Strategy and Analysis, Fourth Edition 1996 Addison-Wesley Publishing Company, Inc. All rights reserved.

MINA Fiber Board Co.MINA Fiber Board Co.Bar ChartBar Chart

20

15

10

5

0

Num

ber o

f def

ects

First Second ThirdShift

To accompany Krajewski & Ritzman Operations Management: Strategy and Analysis, Fourth Edition 1996 Addison-Wesley Publishing Company, Inc. All rights reserved.

Deming’s 14 PointsDeming’s 14 Points Create constancy of purpose Adopt a new philosophy Cease dependence on mass

inspection End the practice of buying on price

alone Use statistical methods to find

problems and continually improve

To accompany Krajewski & Ritzman Operations Management: Strategy and Analysis, Fourth Edition 1996 Addison-Wesley Publishing Company, Inc. All rights reserved.

Deming’s 14 PointsDeming’s 14 Points Institute modern methods of on-the-

job training Improve supervision Drive out fear Break down barriers Eliminate numerical goals and

slogans

To accompany Krajewski & Ritzman Operations Management: Strategy and Analysis, Fourth Edition 1996 Addison-Wesley Publishing Company, Inc. All rights reserved.

Deming’s 14 PointsDeming’s 14 Points Eliminate work standards that simply

set quotas Remove barriers between employees

and their pride of workmanship Institute a vigorous program of

education and retraining Structure management to continually

support these points

To accompany Krajewski & Ritzman Operations Management: Strategy and Analysis, Fourth Edition 1996 Addison-Wesley Publishing Company, Inc. All rights reserved.

Prominent Quality Experts (“Gurus”)• J. M. Juran: focus on quality:

– Planning: set quality level & design the production process to achieve it - annual quality program

– Control: use SQC to ensure product quality meets standards as while in production

– Improvement: Study & analyze problems & implement a remedy. 100’s of Quality Improvements projects going on in a company.

To accompany Krajewski & Ritzman Operations Management: Strategy and Analysis, Fourth Edition 1996 Addison-Wesley Publishing Company, Inc. All rights reserved.

Prominent Quality Experts (“Gurus”)

• P.B. Crosby: Quality is free - “absolute Quality management’

– First: Quality - conformance to requirements

– Second: Prevention to achieve quality (with the help of SQC)

– Third: ZERO defects is achievable– Finally: quality must be measured.

To accompany Krajewski & Ritzman Operations Management: Strategy and Analysis, Fourth Edition 1996 Addison-Wesley Publishing Company, Inc. All rights reserved.

Prominent Quality Experts (“Gurus”)•A. V. Feigenbaum: TQC

– all areas in company emphasize quality

– quality at the source– quality problems:

workers/supervisors stop line

To accompany Krajewski & Ritzman Operations Management: Strategy and Analysis, Fourth Edition 1996 Addison-Wesley Publishing Company, Inc. All rights reserved.

Prominent Quality Experts (“Gurus”)• K. Ishikawa: Quality Circles, Fishbone Diagram & graphical analysis of quality problems

• G. Taguchi: Use product & process design to achieve high quality at lowest cost. Quality is achieved with product uniformity around a target

– Loss function (all costs of poor quality)– set production process to achieve

uniformity

To accompany Krajewski & Ritzman Operations Management: Strategy and Analysis, Fourth Edition 1996 Addison-Wesley Publishing Company, Inc. All rights reserved.

Quality Awards

• The Deming Application Prize: (1957) Annual- meet set of standards for successful application of SQC. Three major categories: individuals in Japan, organizations in Japan, overseas organizations.

To accompany Krajewski & Ritzman Operations Management: Strategy and Analysis, Fourth Edition 1996 Addison-Wesley Publishing Company, Inc. All rights reserved.

Quality Awards• The Malcolm Baldrige National Quality Award: (1987)

Given annually to up to 2 companies in manufacturing, service and small business. Criteria include: soundness of approach to quality improvement, quality management program & its implemen- tation and customer satisfaction.

To accompany Krajewski & Ritzman Operations Management: Strategy and Analysis, Fourth Edition 1996 Addison-Wesley Publishing Company, Inc. All rights reserved.

Quality Awards• The president’s Award for Quality: (1988)recognize US federal Government agencies with >500 workers

• The IIE Award for Excellence in Productivity Improvement: (1980)

• NASA’s Quality and Excellence Award- for quality among suppliers

To accompany Krajewski & Ritzman Operations Management: Strategy and Analysis, Fourth Edition 1996 Addison-Wesley Publishing Company, Inc. All rights reserved.

ISO 9000 Standards

• International Organization for Standardization (ISO) - 90 member countries

• Purpose of ISO: Global agreement on international standards

• system to certify suppliers to meet quality management standards

To accompany Krajewski & Ritzman Operations Management: Strategy and Analysis, Fourth Edition 1996 Addison-Wesley Publishing Company, Inc. All rights reserved.

ISO 9000 Standards• First published in 1987 in 4 subsections • ISO 9001: Quality systems - Model for Quality

Assurance in Design/Development, Production, Installation, and Servicing - widest scope of application

• ISO 9002: Quality systems - Model for Quality Assurance in Production and Installation

• ISO 9003: Quality systems - Model for Quality Assurance in Final Inspection and Test

• ISO 9004: Quality systems - Quality Management & Quality System Elements - Guidelines

To accompany Krajewski & Ritzman Operations Management: Strategy and Analysis, Fourth Edition 1996 Addison-Wesley Publishing Company, Inc. All rights reserved.

ISO 9000 Accreditation • Originally customers would evaluate the quality systems of their suppliers

• Some EC countries (e.g. UK) require an accredited registrar to assess (for a fee) a company’s quality system & its compliance with ISO 9000

• Certificate is issued to company meeting ISO• Company becomes ISO Registrars• In the future virtually all products exported to the EC will require certification

To accompany Krajewski & Ritzman Operations Management: Strategy and Analysis, Fourth Edition 1996 Addison-Wesley Publishing Company, Inc. All rights reserved.

Gaining The Competitive Edge• In the US many of the applicants for the Baldrige

Award also apply for ISO 9000 registration.• Two complement each other with the same goals

of commitment to total quality & customer satisfaction

• ISO 9000: documentation, the standardization and the common language needed to establish a quality management system

• The Baldrige criteria focus more on continuous improvement, measurement of processes and strategic planning